First Reliance makes partial redemption of TARP preferred

FLORENCE, SC – First Reliance Bank announced that it redeemed another 7,000 shares of its Fixed Rate Cumulative Perpetual Preferred Stock, Series A that were originally issued to the United States Department of the Treasury  under the Troubled Asset Relief Program Capital Purchase Program (“TARP”).

On May 31, 2016, the Company redeemed 4,000 shares of its Series A Preferred Stock and announced that it has sent required notice letters to holders informing them of its intent to redeem the remaining 11,349 shares of Series A Preferred Stock and 767 shares of Series B Preferred Stock, subject to receipt of requisite regulatory approval. The 7,000 share redemption announced today represents the next phase of the previously announced redemption plan.

The Company expects to redeem the remaining 4,349 shares of Series A Preferred Stock and all outstanding shares of its Series B Preferred Stock during the third quarter of 2016. The redemption price was $1,000 per share, plus accrued and unpaid dividends. The total aggregate redemption price of the shares of Series A Preferred Stock redeemed today was $7.0 million, plus accrued but unpaid dividends.

Following completion of the redemptions, the capital ratios of First Reliance Bank are expected to continue to far exceed regulatory capital standards to be categorized as well-capitalized and the bank will have sufficient capital to support future balance sheet growth. Redemption of the TARP securities will reduce the Company’s after-tax interest expense and is expected to positively impact earnings per share on an annual basis by $0.21 per share, or approximately $977,000 additional net income to common shareholders.

ABOUT FIRST RELIANCE BANCSHARES, INC.

First Reliance Bancshares, Inc. is the holding company for First Reliance Bank. The Bank was founded in 1999, employs approximately 120 highly-talented associates and serves the Columbia, Lexington, Charleston, Mount Pleasant and Florence markets in South Carolina.