The deal follows a prior transaction in which EJF Capital canceled more than $1 million in interest on Trust Preferred Securities. By converting these obligations into equity, Carver aims to reduce its debt overhang and gain greater financial flexibility as it pursues a broader transformation strategy.
Carver Bancorp Secures Debt-to-Equity Swap with EJF Capital
Carver Bancorp is offloading $250,000 in interest obligations by issuing 100,174 shares of common stock to EJF Capital. This second agreement between the two firms signals a deepening institutional endorsement of the Harlem-based bank’s ongoing efforts to clean up its balance sheet and modernize its leadership.
Lewis P. Jones III, Chairman of the Board, noted that the firm has invited EJF to appoint a Board observer to provide additional oversight during this transition. Donald Felix, CEO of Carver, described the agreement as a validation of the company's long-term growth plan. Jason Ruggiero, Co-Chief Investment Officer at EJF, added that a leaner balance sheet is essential for the bank to successfully execute its strategy. Performance Trust Capital Partners, LLC acted as the financial advisor for the transaction.
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