Bridgewater Bancshares plans to sell stock to the public

Fast-growing Bridgewater Bancshares of Bloomington intends to sell stock to the public, according to a registration statement filed Friday with the Securities and Exchange Commission (SEC).

The company said its investment bankers have yet to determine the share price but that it could raise about $50 million, according to the preliminary filing with the SEC.

The final amount raised will depend upon the number of shares investors are willing to buy at what price.

Bridgewater, parent company of Bridgewater Bank, earned $19 million in 2017.

Bridgewater posted a return of 1.16 percent on assets of $1.6 billion.

The company, which is mostly a real estate and small business lender, said its return on equity was 13.2 percent last year.

Jerry Baack has led Bridgewater since it was founded in 2005.

Bridgewater raised $10 million at inception from senior management and other investors.

It since has raised $57.3 million in additional equity from Castle Creek Capital, EJF Capital and other institutions.

"We believe our company is one of only a few in the banking industry to have achieved substantial growth while maintaining consistently strong earnings," Bridgewater said in the SEC filing. "We became profitable in our third month of operations and have achieved monthly profitability since that time."

Officers and directors of the company, who own 25 percent of the stock, plan to sell less than 6 percent of their holdings into the offering.

The company, one of the 10 largest Minnesota commercial banks by assets and deposits, claims stockholder equity of $137.2 million, including retained earnings.

The recent rise in interest rates and the growing profitability of well-run banks in recent years, as well as the buoyant stock market and investor appetite for new offerings, has made this a pretty good time to interest outside investors and redeem some of the shares of private-equity investors who typically want to cash out at least some of their holdings within several years.