Press release
Alerus Financial Corporation Sells $172.3M of Debt Securities and Uses Proceeds to Fund Loan Growth, Cut Borrowings
MINNEAPOLIS--(BUSINESS WIRE)-- On December 15, 2023, Alerus Financial Corporation (NASDAQ: ALRS) completed the sale of $172.3 million of available-for-sale
About this update from Alerus Financial Corporation
[{"type":"text","content":" MINNEAPOLIS--(BUSINESS WIRE)--\nOn December 15, 2023, Alerus Financial Corporation (NASDAQ: ALRS) completed the sale of $172.3 million of available-for-sale securities (“AFS”). The sale resulted in a one-time pre-tax net loss of $24.7 million. Proceeds from the sale will be reinvested into loans to new and existing clients throughout the communities the Company serves in addition to paying down borrowings. The weighted average yield on the AFS securities sold was 2.66% and the estimated time to earn back this loss is approximately 3.7 years, compared to the estimated weighted average remaining life of the AFS securities sold of 6.1 years. The restructuring has no impact on tangible capital, improves the net interest margin and positions the company for higher earnings in 2024.\n\n\nPresident and Chief Executive Officer Katie Lorenson added, “With a strong commercial loan pipeline in the fourth quarter, we made the strategic decision to sell securities and reinvest the proceeds into higher yielding loans. Our balance sheet remains strong with robust capital and liquidity, as demonstrated by our recently announced quarterly dividend and share repurchase program authorization of up to 1 million shares. Overall, the sale moves low yielding investments off of the balance sheet to be replaced with loans to clients across the communities we serve, while positioning the company for higher returns and future book value growth.”\n\n\nAbout Alerus Financial Corporation\n\n\nAlerus Financial Corporation is a diversified financial services company with corporate offices in Grand Forks, North Dakota, and the Minneapolis-St. Paul, Minnesota metropolitan area. Through its subsidiary, Alerus Financial, N.A., Alerus provides innovative and comprehensive financial solutions to business and consumer clients through four distinct business segments—banking, retirement and benefit services, wealth management, and mortgage. Alerus provides clients with a primary point of contact to help fully understand the unique needs and delivery channel preferences of each client. Clients are provided with competitive products, valuable insight and sound advice supported by digital solutions designed to meet the clients’ needs. Alerus has banking, mortgage, and wealth management offices in Grand Forks and Fargo, North Dakota, the Minneapolis-St. Paul, Minnesota me...