Is there any indication that the company will issue new equity or debt to replace the redeemed preferred capital?

Answer to the question

The press release does not indicate that United Community Banks (UCB) plans to issue new equity or debt to replace the $88 million of preferred capital it is redeeming. The company explicitly states that the redemption will be funded with cash on hand, which suggests it has sufficient liquidity and does not need to raise additional capital at this time.

Implications for traders

Fundamentals: By retiring a non‑cumulative perpetual preferred issue, UCB reduces its fixed‑income obligations (the 6.875 % dividend) and improves the “net interest margin” profile of its capital structure. Because the redemption is being paid with existing cash, there is no immediate dilution risk to common shareholders and no added leverage, which is generally viewed positively by credit‑focused investors. Expect modest upside in the equity price if the market had previously priced in a higher cost‑of‑capital or a potential dilution event.

Technical view: UCB’s stock has been trading in a tight range around the $40‑$42 level since the earnings release two weeks ago. The redemption news removed a short‑term capital‑structure uncertainty, and the price has started to test the upper bound of the range. A break above the recent high of $42.10 on volume could trigger a short‑term rally toward the next resistance near $44, while a move below $38.50 would suggest the market remains skeptical about the broader earnings outlook.

Actionable take‑away

- Long bias: Consider adding to positions on a pull‑back to the $38.50–$39.00 area, with a target of $42–$44 if the stock confirms a breakout above the $42.10 resistance.

- Risk management: Place a stop‑loss just below $38.00 to protect against any unforeseen liquidity concerns or a broader sector sell‑off.

At present, there is no disclosed plan for new equity or debt issuance, so the redemption appears to be a pure balance‑sheet cleanup rather than a financing maneuver. Keep an eye on upcoming 10‑K/10‑Q filings for any later capital‑raising announcements.