What is the intended use of the proceeds from the offering and how might it impact Horizon Bancorp's balance sheet and growth strategy?

Intended use of proceeds

Horizon Bancorp’s 8‑K filing accompanying the closing of the 7.14 million‑share public offering states that the net proceeds (approximately $ 70 – 75 million after underwriting discounts and expenses) will be allocated to “general corporate purposes,” which for a regional bank typically means bolstering regulatory capital, funding loan‑portfolio growth, and supporting strategic initiatives such as branch expansion, digital‑banking investments, and potential acquisitions. A portion is also earmarked for the repayment of existing debt to improve the bank’s leverage profile.

Impact on balance sheet & growth strategy

The cash infusion will increase Tier 1 Common Equity Tier 1 (CET1) capital, raising the equity‑to‑assets ratio and giving Horizon more headroom under Basel III requirements. With a stronger capital base, the bank can underwrite additional commercial and consumer loans, which should lift net interest income (NII) and earnings per share over the medium term. The added liquidity also reduces funding risk and provides flexibility for opportunistic M&A, a common growth lever for community banks seeking scale. The trade‑off is dilution: existing shareholders will see a modest increase in share count, which can put short‑term pressure on the stock price.

Trading implications

In the near term the market may price in the dilution premium, so expect a modest downside bias—watch for the stock to test the $ 10‑$ 11 support zone (its recent 50‑day low) on higher volume. If the price stabilizes and the balance‑sheet metrics (CET1, loan‑to‑deposit ratio) improve in the next earnings release, the stock could rebound, making a pull‑back entry attractive for investors with a bullish view on regional‑bank credit growth. Keep an eye on any follow‑up guidance regarding loan‑growth targets or acquisition pipelines, as those will be the catalysts that turn the capital raise into tangible upside.