Financial Institutions, Inc. Launches Public Stock Offering

Financial Institutions, Inc. (NASDAQ:FISI), the parent company of Five Star Bank and Courier Capital, LLC, has initiated a public offering of its common stock shares. This underwritten offering also includes an option for underwriters to buy additional shares over the next 30 days. Over the past six months, FISI has experienced significant growth, with its stock price increasing by nearly 60%, and it currently trades with a P/E ratio of 8.4x, according to InvestingPro data.

The funds raised from this public offering will be used for general corporate purposes. This includes efforts to restructure the company's balance sheet and reposition a substantial portion of its available-for-sale debt securities portfolio, as well as repaying existing debts. The objective of this restructuring is to facilitate ongoing growth.

Keefe, Bruyette & Woods, Inc., a Stifel Company, is acting as the lead bookrunner for this offering, with Piper Sandler & Co. serving as the co-manager.

This stock offering is conducted under a registration statement on Form S-3, which was approved by the Securities and Exchange Commission (SEC) on December 4, 2024. Investors interested in more detailed information about Financial Institutions, Inc. and the offering can find the preliminary prospectus supplement and final prospectus supplement on the SEC's website.

Financial Institutions, Inc. boasts approximately $6.2 billion in assets and operates as a financial holding company providing various banking and wealth management services. Its subsidiary, Five Star Bank, delivers consumer and commercial banking services across Western and Central New York, while Courier Capital, LLC provides investment management and consulting services. With a market capitalization of $420.75 million, the company maintains a robust dividend tradition, boasting a 4.49% yield and having increased its dividend for 13 consecutive years, as reported in an analysis by InvestingPro.

The company has warned that this press release contains forward-looking statements that involve risks and uncertainties, which could lead to outcomes differing significantly from those anticipated. For further insights into FISI's financial situation and its growth potential, investors are encouraged to access the comprehensive Pro Research Report available through InvestingPro.

Furthermore, Financial Institutions, Inc. recently declared a quarterly cash dividend of $0.30 per common share and also announced dividends for preferred stockholders, reinforcing its commitment to delivering value to shareholders. However, the company did report a decrease in net income for the third quarter of 2024, totaling $13.1 million, primarily due to the absence of a one-off gain from the sale of its insurance business. Despite this reduction, there was a noted increase in the company's net interest margin, and they remain optimistic about their core financial performance.

Additionally, Financial Institutions, Inc. has experienced growth in total deposits, though total loans saw a slight decline. Analysts have revised the company’s projected annual loan growth for 2024 to the lower end of the 1% to 3% range. In a significant development, Christopher Campise has been appointed as the new Senior Vice President and Chief Information Officer of Five Star Bank, tasked with leading advancements in the bank's technology and enhancing its IT framework. Investors should pay attention to these recent developments.

This news is based on a press release from Financial Institutions, Inc.

Financial, Stocks, Offering