River City Bank Closes an Initial Public Offering

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Brief History

Big news for our shareholders.  After spending 53 years as a semi-private bank with our shares trading in low daily average volumes via the Over the Counter (“OTC”) market, River City Bank is now publicly traded on the Nasdaq exchange under the ticker symbol RCBC after closing on an initial public offering (“IPO”) in early August 2026. Read on to learn more about the impetus for this transaction and the benefits it creates. 

River City Bank was founded in Sacramento in 1973 by Jon Kelly, a highly successful entrepreneur and businessman, who passed away in 2020.  Throughout our history, Mr. Kelly and/or various members of his family have owned most of the Bank’s shares. Due to this ownership concentration and the fact that the shares weren’t listed on a major stock exchange, the trading volume of RCBC has always been relatively low. 

IPO Proceeds

This IPO was entirely a secondary offering, meaning the Bank itself did not sell shares and did not receive any of the proceeds. The Bank remains well capitalized with adequate liquidity and therefore does not need to raise equity capital. Instead, this IPO represents members of the Kelly family selling a portion of their shares. 

What Was Sold?

2.7 million shares were sold at $45/share, representing gross proceeds of $121.5 million. 

Who Acquired the Shares?

An assortment of institutional and high net worth investors, primarily introduced to RCBC by the investment bankers that the Bank and Kelly family engaged to facilitate the IPO. Having this broad and diversified group of investors was the ideal outcome of the IPO as it’s expected to bring more consistent trading volume compared to concentrated ownership positions. 

Is the Kelly Family Selling All Their Shares?

No, the family has retained the majority of their shares – roughly going from 60% ownership to 40% – and remains highly invested in RCBC. 

Why Now?

RCBC stock has appreciated materially over the years as the Bank has performed exceptionally well, making it a concentration in certain Kelly family members’ investment portfolios. As a result, these family members sought liquidity and investment portfolio diversification for reasons unrelated to the Bank’s performance. Additionally, the Bank has now grown to have over $6B in assets, which makes it much easier to absorb the additional compliance and audit costs related to being listed on the Nasdaq. 

Benefits of the IPO

Besides the benefits to the Kelly family members noted above, the Bank believes the IPO will be accretive to all RCBC shareholders.  The primary benefit to shareholders is anticipated to be increased liquidity driven by a combination of:

  1. $121.5 million of RCBC stock is now owned by a broad/diversified set of investors who will have many different opinions, hold periods, tax situations, etc.; this should result in more transactions, all else the same. 
  2. The Nasdaq platform and the confidence its financial disclosure requirements bring to investors should attract more investors who previously wouldn’t invest in a stock that only traded on the OTC market.  This would particularly be true if any Wall Street analysts began to cover the stock; there’s no guarantee this will happen, but it’s more likely with a stock trading on the Nasdaq than the OTC. 
  3. The Nasdaq market’s more sophisticated framework makes it much easier for market makers to facilitate sales compared to the OTC markets, which should mean that market makers are more active in offering to buy or sell shares. 

There are also some secondary effects of this increased liquidity such as:

  1. Margin borrowing. Many investors should now be able to use RCBC as collateral in a margin account, which is typically not allowed for OTC stocks. 
  2. Stock as a currency in an M&A.  Although nothing is currently being contemplated, if the Bank ever decides to engage in a merger or acquisition transaction with another bank, having a Nasdaq trading stock puts us in a better position to get a good outcome for our shareholders. 
  3. Employee recruitment and retention. We take great pride in the quality of the team at the Bank – indeed, we regard it as our single most important differentiator. Having a stock which is listed on the Nasdaq will help, at least on the margin, with recruiting and retaining top talent.  

Benefits of the IPO

We do not expect the IPO to adversely affect the customer experience.  The primary changes stemming from the IPO lie in the Bank’s accounting department where there will be additional audits and reporting. 

If you have additional questions, please contact our investor relations department at [email protected]. 

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