Raising Capital: Considerations For A Stock Offering

 
Raising capital is like putting gas in your car—it is best to get it before you really need it. The biggest step in raising capital may be the step from "perhaps we should" to "let's make it happen." Your bank may have discussed raising capital for any number of reasons: regulatory obligations, potential expansion, fears of Basel III, or otherwise. If your institution is considering raising capital, consider this:

1. Involve your board. The board of directors has the ultimate responsibility for considering and approving a sale of stock, so make sure to involve your board throughout the process. Your board should consider the adequacy and appropriateness of the price, the amount of capital sought, and the terms of the offering, as well as the impact on existing shareholders. The board's discussions and resolutions should be carefully recorded in the minutes of their meetings.