Franklin Financial Network, Inc. has priced USD 40 million principal amount of its fixed-to-floating rate subordinated notes due 2026. Notes will initially bear interest at 6.875% per annum, payable semi-annually in arrears, to, but excluding, March 30, 2021, and, thereafter, payable quarterly in arrears, at an annual floating rate equal to three-month LIBOR as determined for the applicable quarterly period, plus a spread of 5.636%. BofA Merrill Lynch is acting as the sole book-running manager for the notes offering and Raymond James is acting as the lead manager.

The company said it intends to use the net proceeds from the offering, in part, to pay down a line of credit, which the company used on March 25, 2016, to redeem the outstanding shares of Series A preferred stock issued to the US Treasury for USD 10 million pursuant to the company's participation in the Small Business Lending Fund program. The company said it intends to use any remaining net proceeds from the sale of the notes for general corporate purposes. Franklin Financial Network, Inc. is a financial holding company headquartered in Franklin, Tennessee.