Terms

Series

5.875% Non-Cumulative Perpetual Preferred Stock, Series A

Liquidation Preference

$25.00

Coupon Rate

5.875%

Rate Type

Fixed

Annual Dividend

$1.47

Payment Frequency

Quarterly

Cumulative

No

Perpetual

Yes

Convertible

No

Callable

Yes

First Call Date

August 17, 2026

First Call Price

$25.00

Capital Stack Ranking

Junior To: All Existing And Future Indebtedness Of Bridgewater Bancshares And Its Subsidiaries, All Non-Equity Claims On Bridgewater; Pari Passu With: Parity Stock (Any Future Capital Stock Expressly Ranking On Parity); Senior To: Common Stock, Junior Stock (Any Future Capital Stock Not Expressly Ranking Pari Passu Or Senior)

Regulatory (Basel III) Call

Yes

Tax Classification

Qualified Dividend

Qualifies for QDI

Yes

Qualifies for DRD

Yes

Depositary Share Fraction

0.01

Shares Offered

2,400,000

Prospectus Summary

Bridgewater Bancshares, Inc. (Nasdaq: BWB), a Minnesota bank holding company with approximately $3.2 billion in total assets, is offering 2,400,000 depositary shares (ticker: BWBP), each representing a 1/100th interest in a share of its 5.875% Non-Cumulative Perpetual Preferred Stock, Series A. The depositary shares are priced at $25.00 per share (liquidation preference equivalent), carry a fixed annual coupon of 5.875%, and are callable at par on any dividend payment date on or after August 17, 2026. This preferred stock is non-cumulative, meaning that if the board omits a quarterly dividend, that payment is permanently lost — it does not accrue or become payable in future periods. The Series A Preferred ranks senior to Bridgewater's common stock and any future junior equity, but is subordinate to all existing and future debt obligations of both Bridgewater Bancshares (the holding company) and its bank subsidiary, Bridgewater Bank. Because this is a holding company issuance, preferred holders face structural subordination — creditors of Bridgewater Bank have prior claims on the bank's assets before any value flows up to the holding company. A regulatory capital treatment event call allows Bridgewater to redeem the entire issue (not partially) within 90 days if a change in law or regulation causes the Preferred Stock to lose its Tier 1 capital treatment — a meaningful risk for investors who value the call optionality. At the $25.00 offering price, the Series A yields exactly 5.875% annually, or approximately $0.3672 per depositary share per quarter. Dividends are payable quarterly in arrears on March 1, June 1, September 1, and December 1, beginning December 1, 2021. Dividends from a C-corporation preferred are generally expected to qualify for the preferential 15%/20% qualified dividend income (QDI) rate for individual holders and the dividends-received deduction (DRD) for corporate holders, though investors should consult the tax section of the prospectus for specifics. The dividend stopper mechanic means that if Bridgewater skips a full dividend on the Preferred for the most recently completed period, it cannot pay dividends on or repurchase common stock or junior securities during the next succeeding period — providing a measure of protection but not guaranteeing preferred dividend continuity.

Summarized from the SEC prospectus filing.

Distribution History

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If Bridgewater has not paid full dividends on the Preferred Stock for the most recently completed dividend period, it cannot declare or pay dividends on, or repurchase or redeem, its common stock or any other junior-ranking stock during the next succeeding dividend period.

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 70 (Strong)