Citizens Republic Prices $200 Million in Concurrent Offerings of Common Stock and...

Citizens Republic Prices $200 Million in Concurrent Offerings of Common Stock
and Contingent Convertible Perpetual Non-Cumulative Preferred Stock

FLINT, Mich., June 6 /PRNewswire-FirstCall/ -- Citizens Republic Bancorp,
Inc. (Nasdaq: CRBC) announced today it has priced its previously announced
concurrent offerings of $79.6 million or 19,904,450 million shares of common
stock and $120.4 million or 2,407,644 million shares of contingent convertible
perpetual non-cumulative preferred stock, Series A, with a liquidation
preference of $50 per share. Citizens has granted the underwriters a 30-day
option to purchase up to an additional 15% on each offering to cover
over-allotments. The offerings are expected to close on June 11, 2008. The
additional capital will enhance Citizens' balance sheet and enable it to
remain focused on executing its strategic objectives and delivering long-term
shareholder value as current economic and credit conditions improve.
The common stock offering was priced at $4.00 per share and Citizens
estimates that the net proceeds from the common stock offering will be
approximately $75.2 million, after deducting underwriting commissions and
offering expenses (or approximately $86.6 million if the underwriters exercise
their over-allotment option to purchase additional shares of common stock in
full). Citizens estimates that the net proceeds from the contingent
convertible perpetual non-cumulative preferred stock offering will be
approximately $113.8 million, after deducting underwriting commissions and
offering expenses (or approximately $130.9 million if the underwriters
exercise their over-allotment option to purchase additional shares of
preferred stock in full). Based on the common stock closing market price on
June 5, 2008, the issue date of the preferred stock offering, we expect to
record a beneficial conversion of $11.7 million. The company anticipates
making a corresponding credit to additional paid in capital which will not
affect total shareholders equity, capital or capital adequacy ratios.
Shareholder approval will be required to increase the number of authorized
shares to allow for conversion of the preferred stock to common stock and
Citizens intends to seek such approval no later than 120 days after completion
of this offering. Each share of preferred stock will automatically convert
into 12.5 shares of common stock, subject to anti-dilution adjustments, five
business days after Citizens has received shareholder approval. The preferred
stock will receive, when, as and if declared by Citizens' Board of Directors,
dividends equal to those declared on the common stock on an as-if-converted
basis. In the event shareholder approval is not obtained by the 120th day,
additional special dividends will be payable, when, as and if declared by
Citizens' Board of Directors on a quarterly basis. The conversion rate will
be subject to customary anti-dilution adjustments and will also be adjusted
upon the occurrence of certain events.
Morgan Stanley & Co. Incorporated and Citi are serving as joint
bookrunning managers for these offerings. The offerings were made under
Citizens' shelf registration statement filed with the Securities and Exchange
Commission.
Additional Information
Citizens has filed a registration statement (including a prospectus) with
the Securities and Exchange Commission (SEC) for the offerings to which this
communication relates. Before you invest, you should read the preliminary
prospectus supplements dated June 5, 2008, the accompanying prospectus dated
September 21, 2006 and other documents we have filed with the SEC for more
complete information about Citizens and these offerings. You may obtain these
documents and other documents Citizens has filed for free by visiting the
SEC's web site at www.sec.gov. Alternatively, Citizens, any underwriter or any
dealer participating in the offering will arrange to send you the preliminary
prospectus supplements and accompanying prospectus if you request them by
contacting Morgan Stanley & Co. Incorporated, 180 Varick Street, 2nd Floor,
New York, NY 10014, Attention: Prospectus Department, email:
prospectus@morganstanley.com, telephone (866) 718-1649 or Citi, Brooklyn Army
Terminal, 140 58th Street, 8th Floor, Brooklyn, NY 11220, telephone
(877) 858-5407, facsimile (718) 765-6734.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of, these
securities in any state or jurisdiction in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under the
securities laws of any such state or jurisdiction.
Corporate Profile
Citizens Republic Bancorp is a diversified financial services company
providing a wide range of commercial, consumer, mortgage banking, trust and
financial planning services to a broad client base. Citizens Republic Bancorp
serves communities in Michigan, Ohio, Wisconsin, and Indiana as Citizens Bank
and in Iowa as F&M Bank, with 239 offices and 265 ATMs. Citizens Republic
Bancorp is the largest bank holding company headquartered in Michigan with
roots dating back to 1871. Citizens Republic Bancorp is the 41st largest bank
holding company headquartered in the United States. More information about
Citizens Republic Bancorp is available at www.citizensbanking.com.
Safe Harbor Statement
Discussions and statements in this release that are not statements of
historical fact, including statements that include terms such as "will,"
"may," "should," "believe," "expect," "anticipate," "estimate," "project,"
"intend," and "plan," including without limitation future financial and
operating results, plans, objectives, expectations and intentions and other
statements that are not historical facts, are forward-looking statements that
involve risks and uncertainties. Any forward-looking statement is not a
guarantee of future performance and actual results could differ materially
from those contained in the forward-looking information.
Factors that could cause or contribute to such differences include,
without limitation, adverse changes in Citizens' loan and lease portfolios
resulting in credit risk-related losses and expenses (including without
limitation losses due to fraud, Michigan automobile-related industry changes
and shortfalls, deterioration in commercial and residential real estate
values, and other economic factors) as well as additional increases in the
allowance for loan losses; fluctuations in market interest rates, the effects
on net interest income of changes in Citizens' interest rate risk position and
the potential inability to hedge interest rate risks economically; adverse
changes in economic or financial market conditions and the economic effects of
terrorist attacks and potential attacks; Citizens' potential inability to
continue to attract core deposits; Citizens' potential inability to continue
to obtain third party financing on favorable terms; adverse changes in
competition, pricing environments or relationships with major customers;
unanticipated expenses and payments relating to litigation brought against
Citizens from time to time; Citizens' potential inability to adequately invest
in and implement products and services in response to technological changes;
adverse changes in applicable laws and regulatory requirements; the potential
lack of market acceptance of Citizens' products and services; changes in
accounting and tax rules and interpretations that negatively impact results of
operations or financial position; the potential inadequacy of Citizens'
business continuity plans or data security systems; the potential failure of
Citizens' external vendors to fulfill their contractual obligations to
Citizens; Citizens' potential inability to integrate acquired operations;
unanticipated environmental liabilities or costs; impairment of the ability of
the banking subsidiaries to pay dividends to the holding company parent; the
potential circumvention of Citizens' controls and procedures; Citizens'
success in managing the risks involved in the foregoing; and other risks and
uncertainties detailed from time to time in its filings with the SEC, which
are available at the SEC's web site www.sec.gov. Other factors not currently
anticipated may also materially and adversely affect Citizens' results of
operations, cash flows and financial position. There can be no assurance that
future results will meet expectations. While Citizens believes that the
forward-looking statements in this release are reasonable, you should not
place undue reliance on any forward-looking statement. In addition, these
statements speak only as of the date made. Citizens does not undertake, and
expressly disclaims any obligation to update or alter any statements, whether
as a result of new information, future events or otherwise, except as required
by applicable law.
(Logo: http://www.newscom.com/cgi-bin/prnh/20050421/DETH014LOGO )
SOURCE Citizens Republic Bancorp, Inc.

Charles D. Christy, EVP & Chief Financial Officer, +1-810-237-4200,
charlie.christy@citizensbanking.com, or Kristine D. Brenner, Director of
Investor Relations, +1-810-257-2506, kristine.brenner@citizensbanking.com,
both of Citizens Republic Bancorp, Inc.