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Republic First Bancorp, Inc. Reports Second Quarter Financial Results; Named America’s #1 Bank for Service by Forbes Magazine

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PHILADELPHIA, July 27, 2020 (GLOBE NEWSWIRE) -- Republic First Bancorp, Inc. (NASDAQ: FRBK), the holding company for Republic Bank, today announced its financial results for the period ended June 30, 2020.

Q2-2020 Financial Highlights

  • During the second quarter of 2020 Republic Bank was named as America’s # 1 Bank for Service in a recent national Forbes survey to identify which financial institutions have the most satisfied customers.

  • We originated $682 million in loans under the Paycheck Protection Program (PPP) administered by the SBA providing crucial funding for small business throughout our footprint. Gross origination fees of $22 million were earned through this program which will be recognized as income over the life of the loans.

  • Profitability improved as the Company reported net income of $2.5 million, or $0.04 per share, during the second quarter of 2020 compared to a net loss of $0.6 million, or ($0.01) per share during the first quarter of 2020.

  • Pre-tax pre-provision earnings (PTPP) increased to $4.2 million during the second quarter of 2020 compared to $27 thousand in the first quarter of 2020 and $0.5 million in the second quarter of 2019.

  • On a linked quarter basis, total revenue increased 13% during the second quarter of 2020 while non-interest expense decreased by 2% compared to the first quarter of 2020. Year over year total revenue increased 17% and non-interest expense increased 3% during the quarter ended June 30, 2020 compared to the quarter ended June 30, 2019.

  • Asset quality continues to improve as the ratio of non-performing assets to total assets declined to 0.31% as of June 30, 2020. Only 2% of our loan customers were deferring loan payments as of July 24, 2020. These deferrals relate to approximately 7% of outstanding loan balances excluding PPP loans.

  • Total loans grew $1.0 billion, or 69%, to $2.5 billion as of June 30, 2020 compared to $1.5 billion at June 30, 2019. Excluding the impact of the PPP loan program loans grew $380 million, or 25%, year over year.

  • Total deposits increased by $1.1 billion, or 44%, to $3.6 billion as of June 30, 2020 compared to $2.5 billion as of June 30, 2019. Excluding the impact of the PPP loan program deposits grew $716 million, or 28%, year over year.

Vernon W. Hill, II, Chairman of Republic First Bancorp said:

“In the second quarter ‘The Power of Red is Back’ expansion campaign continued to deliver exceptional service during these unprecedented times. Our stores remained operational throughout the quarter serving customers in any way possible in a safe and efficient manner. Through our participation in the PPP loan program authorized by the CARES Act we were able assist thousands of small businesses by providing critical access to funding to support operations in the midst of an economic shutdown.”

“In recognition of our unwavering commitment to extraordinary customer service and convenience our FANS responded to a recent Forbes survey and Republic was ranked as America’s #1 Bank for Service. The goal of our model is to create FANS NOT CUSTOMERS, who join our brand, remain loyal and refer family and friends. The results of the Forbes survey not only demonstrates the success of our model, but also shows that we deliver on our commitment to service better that every other bank in the country.”

Republic will launch its new brand campaign as America’s #1 Bank for Service during the third quarter of 2020.

Harry D. Madonna, President and Chief Executive Officer of Republic First Bancorp added:

“Net income during 2019 was negatively impacted by the challenging nature of the interest rate environment and costs required to initiate our expansion into New York City. During the second quarter of 2020 we returned to profitability through the dedication and commitment of every member of the Republic Bank Team to improve earnings. We have consistently stated that it is our goal to deliver best in class service across all delivery channels…..in-store, by phone, online and mobile options....as we strive to create new FANS each and every day. We are focused on meeting that goal in the most efficient manner possible.”

Paycheck Protection Program

During the second quarter the Republic Bank Team turned its attention to the needs of small businesses in our community. The Paycheck Protection Program included in the CARES Act authorized financial institutions to make loans to companies that have been impacted by the devastating economic effects of the coronavirus (COVID-19) pandemic. We responded by quickly developing a process to accept applications for the program not only from our valued small business customers, but from non-customers throughout the community as well.

PPP Loan Program Highlights

Republic Bank recognized the SBA PPP Loan Program as an opportunity to help existing and new small business customers actively participated in the program by accepting applications.

As of June 30, 2020 Republic has:

  • Originated $682 million in PPP loans

  • Related to more than 4,800 PPP loan applications

  • More than 50% of the applications received were from small businesses that were not existing customers of Republic Bank, many of which have already switched their primary banking relationship to Republic Bank

  • The average loan size of all PPP loans approved was $140 thousand

  • Gross origination fees of $22 million were earned by Republic which will be recognized as income over the life of the loans

  • Funding for this program was provided through the Federal Reserve PPP Lending Facility, which has resulted in exclusion of the PPP asset balances from the leverage ratio calculation.

As a percentage of existing loan balances outstanding as of March 31, 2020, the $682 million in PPP loans originated by Republic amounted to 36% making us one of the top PPP lenders in the entire country.

Loss Mitigation and Loan Portfolio Analysis

Management has taken a proactive approach to analyze and prepare for the potential challenges to be faced as the effects of the economic shutdown begin to unfold. A detailed analysis of loan concentrations and segments that may represent the areas of highest risk has been prepared. Our commercial lending team has initiated contact with many of our loan customers to discuss the impact that the pandemic has had on their businesses to date and the expected ramifications that may be felt in the future. We have granted payment deferrals for customers that made a request and had an immediate need for assistance.

Management believes exposure in the loan portfolio to the high risk industries most impacted by the current economic conditions is limited. Loans to customers in the accommodations and food services industry (i.e. hotels and restaurants) amount to 7% of the total loans outstanding as of June 30, 2020. Loans to customers involved in the oil and gas industry (refineries) are less than 1% of outstanding loans and credit card receivables are also less than 1% of total loans as of June 30, 2020.

We believe the combination of ongoing communication with our customers, loan payment deferrals, increased focus on risk management practices, and access to government programs such as the PPP Loan Program should help mitigate potential future period losses.

The following table summarizes the number of loan customers that have been granted payment deferrals along with the related loan outstanding balances through the period ended June 30, 2020:

($ in millions)

# of Loan
Accounts

% of
Total Accts

Loan
Balances

% of Total
Loan
Balances*

Deferral of Principal Only

251

5%

$

270

14%

Deferral of Principal and Interest

192

4%

145

8%

Total Deferrals

443

9%

$

415

22%

Total Deferrals (as of July 24, 2020)

103

2%

$

124

7%

*Note: PPP loans excluded from total loans when calculating % of total loan balances

As of the date of this release more than 75% of the customers that were granted approval for deferral of loan payments have resumed normal principal and interest payments on their outstanding loan balances in the early stages of the third quarter of 2020. During the month of July 2020, the number of customers that have continued with the deferral of loan payments has declined to 103, or 2% of the total loan customers and the related outstanding loan balances have reduced to $124 million, or 7% of the total loan balances outstanding.

Asset Quality

The Company’s asset quality ratios are highlighted below:

Three Months Ended

06/30/20

03/31/20

06/30/19

Non-performing assets / capital and reserves

5

%

6

%

6

%

Non-performing assets / total assets

0.31

%

0.46

%

0.53

%

Quarterly net loan charge-offs / average loans

0.03

%

0.00

%

(0.04

%)

Allowance for loan losses / gross loans

0.43

%

0.54

%

0.53

%

Allowance for loan losses / non-performing loans

87

%

72

%

86

%

The percentage of non-performing assets to total assets decreased to 0.31% at June 30, 2020, compared to 0.53% at June 30, 2019. The ratio of non-performing assets to capital and reserves decreased to 5% at June 30, 2020 compared to 6% at June 30, 2019 primarily as a result of decreases in non-performing assets over the last 12 months.

Quarterly Trend

Profitability in previous quarters was impacted by the inversion of the yield curve and the Company’s strategic decision to enter a new market during 2019. The Company continues to focus on improvement of its operating leverage. The following table highlights changes to some of the key financial metrics that demonstrate this progress:

QTD

QTD

QTD

QTD

QTD

06/30/19

09/30/19

12/31/19

03/31/20

06/30/20

Pre-Tax Pre-Provision Earnings (PTPP)

$

0.5

$

(1.9

)

$

(2.4

)

$

-

$

4.2

% Change in Revenue Qtr-Qtr

10

%

(2

%)

(3

%)

9

%

13

%

% Change in Expense Qtr-Qtr

11

%

7

%

(1

%)

(1

%)

(2

%)

Financial Summary for the Period Ended June 30, 2020

The changes in the balance sheet as of June 30, 2020 were significantly impacted by the effect of the PPP loan program. A portion of the increase in cash balances, outstanding loans, demand deposits and short-term borrowings will be short-term in nature and will change as the borrowers that received PPP loans submit applications for forgiveness to the SBA in the coming months. A summary of the balance sheet presented with and without the impact of the PPP loan program for the period ended June 30, 2020 can be found in the following table:

Excluding

Actual

PPP
Program

Actual

YOY Growth

YOY Growth

($ amounts in millions)

6/30/2020

6/30/2020

6/30/2019

(Including PPP)

(Excluding PPP)

Cash and Cash Equivalents

$

691

$

506

$

130

$

561

432%

$

376

289%

Investment Securities

942

942

1,062

(120)

(11%)

(120)

(11%)

Loans Held for Sale

26

26

23

3

13%

3

13%

Loans Receivable

2,542

1,889

1,509

1,033

69%

380

25%

Allowance for Loan Losses

(11)

(11)

(8)

(3)

38%

(3)

38%

Net Loans

2,531

1,878

1,501

1,030

69%

377

25%

Premises and Equipment

121

121

105

16

15%

16

15%

Other Assets

123

123

120

3

3%

3

3%

Total Assets

$ 4,434

$ 3,596

$

2,941

$

1,493

51%

$

655

22%

Non-interest Bearing Deposits

$

1,096

$

696

$

544

$

552

101%

$

152

28%

Interest Bearing Deposits

2,548

2,548

1,984

564

28%

564

28%

Total Deposits

3,644

3,244

2,528

1,116

44%

716

28%

Short-term Borrowings

438

-

69

369

535%

(69)

(100%)

Subordinated Debt

11

11

11

-

0%

-

0%

Other Liabilities

86

86

82

4

5%

4

5%

Total Liabilities

4,179

3,341

2,690

1,489

55%

651

24%

Common Stock and APIC

273

273

271

2

1%

2

1%

Accumulated Deficit

(10)

(10)

(8)

(2)

25%

(2)

25%

Treasury Stock/Def Comp Plan

(4)

(4)

(4)

-

0%

-

0%

Acc Comp Other Inc

(4)

(4)

(8)

4

(50%)

4

(50%)

Total Shareholders' Equity

255

255

251

4

2%

4

2%

Total Liabilities & Shareholders' Equity

$

4,434

$

3,596

$

2,941

$

1,493

51%

$

655

22%

A summary of the income statement for the period ended June 30, 2020 can be found in the following table:

Three Months Ended

Six Months Ended

06/30/20

06/30/19

Change

06/30/20

06/30/19

Change

Total Revenue

$

36.3

$

33.3

9

%

$

70.1

$

63.7

10

%

Net Income

2.5

0.4

559

%

1.9

0.8

138

%

Net Income per share

$

0.04

$

0.01

300

%

$

0.03

$

0.01

200

%

Net Interest Margin

2.55

%

2.94

%

2.64

%

2.97

%

  • Total assets increased by $1.5 billion, or 51%, to $4.4 billion as of June 30, 2020 compared to $2.9 billion as of June 30, 2019. Excluding the impact of the PPP loan program total assets increased by $655 million, or 22%, as during the twelve month period ended June 30, 2020.

  • We have thirty convenient store locations open today. During the first quarter of 2020 we opened a new store in Northfield, NJ. Construction is ongoing on a site in Bensalem, PA. There are also multiple sites in various stages of development for future store locations.

  • Profitability improved quarter to quarter as we reported net income of $2.5 million, or $0.04 per share, for the three months ended June 30, 2020 compared to a net loss of $0.6 million, or $(0.01) per share for the three months ended March 31, 2020. We reported net income of $0.4 million, or $0.01 per share, for the three months ended June 30, 2019.

  • The net interest margin decreased by 21 basis points to 2.55% for the three months ended June 30, 2020 compared to 2.76% for the three months ended March 31, 2020. The decline in the margin was driven by the impact of the PPP loan program that were added to the balance sheet during the second quarter, along with the lower interest rate environment as a result of rate reductions by the Federal Reserve Bank. Excluding the impact of the PPP loan program the net interest margin would have been 2.70% for the three months ended June 30, 2020.

  • During the first quarter we entered into a branding agreement with Visa to convert all ATM and debit cards to Visa cards which will provide a number of opportunities to enhance revenue growth in the coming years. In the second quarter we entered into another agreement with Visa to handle the processing of all ATM and debit card transactions. This agreement is expected to reduce the cost associated with the processing of these transactions.

  • The Company’s residential mortgage division, Oak Mortgage, is serving the home financing needs of customers throughout its footprint. Loan production during the first half of 2020 was strong despite the impact of the CODID-19 pandemic and the pipeline for the second half of the year looks equally as promising. The Oak Mortgage team has originated more than $500 million in mortgage loans over the last twelve months.

  • The Company’s Total Risk-Based Capital ratio was 12.00% and Tier I Leverage Ratio was 7.58% at June 30, 2020.

  • Book value per common share increased to $4.34 as of June 30, 2020 compared to $4.27 as of June 30, 2019.

Income Statement

The major components of the income statement are as follows (dollars in thousands, except per share data):

Three Months Ended

06/30/20

03/31/20

% Change

06/30/19

% Change

Net Interest Income

$

22,427

$

20,754

8

%

$

19,371

16

%

Non-interest Income

8,424

6,545

29

%

7,026

20

%

Total Revenue

30,851

27,299

13

%

26,397

17

%

Provision for Loan Losses

1,000

950

5

%

-

-

Non-interest Expense

26,664

27,272

(2

%)

25,911

3

%

Income (Loss) Before Taxes

3,187

(923

)

445

%

486

556

%

Provision (Benefit) for Taxes

675

(330

)

305

%

105

543

%

Net Income (Loss)

2,512

(593

)

524

%

381

559

%

Net Income (Loss) per Share

$

0.04

$

(0.01

)

500

%

$

0.01

300

%



Six Months Ended

06/30/20

06/30/19

% Change

Net Interest Income

$

43,181

$

38,511

12

%

Non-interest Income

14,969

11,971

25

%

Total Revenue

58,150

50,482

15

%

Provision for Loan Losses

1,950

300

550

%

Non-interest Expense

53,936

49,178

10

%

Income Before Taxes

2,264

1,004

125

%

Provision for Taxes

345

197

75

%

Net Income

1,919

807

138

%

Net Income per Share

$

0.03

$

0.01

200

%

The Company reported net income of $2.5 million, or $0.04 per share, for the three month period ended June 30, 2020, compared to net income of $381 thousand, or $0.01 per share, for the three month period ended June 30, 2019.

Interest income increased by $1.6 million, or 6%, to $27.9 million for the quarter ended June 30, 2020 compared to $26.2 million for the quarter ended June 30, 2019. The increase in interest income is attributable to the growth in interest-earning assets over the last twelve months driven by the Company’s “Power of Red is Back” expansion strategy. We have also begun to amortize the fees associated with the origination of PPP loans during the second quarter which is reported as interest income. $1.5 million in PPP fees were recorded as income during the quarter ended June 30, 2020 with the remaining balance to be recognized over the life of the loans.

Interest expense decreased by $1.4 million, or 21%, to $5.4 million for the quarter ended June 30, 2020 compared to $6.9 million for the quarter ended June 30, 2019. The decrease in interest expense was primarily driven by a reduction in the cost of deposits as a result of the decrease in the Fed Funds rate during the latter part of the first quarter.

The net interest margin for the three month period ended June 30, 2020 decreased by 39 basis points to 2.55% compared to 2.94% for the three month period ended June 30, 2019. We experienced margin compression throughout 2019 as a result of the flattening of the yield curve. The interest rate on the loans originated under the PPP loan program is 1.00% which caused a decline in the yield on interest earning assets in the second quarter of 2020. In addition, the rate cuts enacted by the Federal Reserve Bank during the first quarter of 2020 has created a lower interest rate environment. The net interest margin excluding the impact of the PPP loan program would have been 2.70%.

Non-interest income increased by $1.4 million, or 20%, to $8.4 million for the three month period ended June 30, 2020, compared to $7.0 million for the three month period ended June 30, 2019. The increase is attributable to gains on the sale of investment securities, higher service fees on deposit accounts which is driven by growth in deposit balances and an increase in the number of deposit accounts, and mortgage banking income driven by mortgage loan originations, partially offset by a decrease in gains on the sale of SBA loans.

Non-interest expense increased by 3%, to $26.7 million during the quarter ended June 30, 2020 compared to $25.9 million during the quarter ended June 30, 2019. The growth in expenses were mainly caused by an increase in occupancy and equipment expenses associated with our growth strategy. Cost control initiatives identified by management have begun to take effect as non-interest expense declined for the third consecutive quarter.

On a linked quarter basis, total revenue increased by 13% during the second quarter of 2020 while non-interest expense declined by 2%. Year over year total revenue increased by 17% and non-interest expense increased by 3% during the second quarter of 2020 compared to the second quarter of 2019.

Deposits

Deposits by type of account are as follows (dollars in thousands):





Description





06/30/20





06/30/19



%
Change





03/31/20



%
Change

Demand noninterest-bearing

$

1,095,782

$

544,406

101

%

$

676,482

62

%

Demand interest-bearing

1,435,198

1,072,415

34

%

1,276,816

12

%

Money market and savings

902,528

719,075

26

%

768,550

17

%

Certificates of deposit

210,446

192,081

10

%

222,631

(5

%)

Total deposits

$

3,643,954

$

2,527,977

44

%

$

2,944,479

24

%

Deposits increased to $3.6 billion at June 30, 2020 compared to $2.5 billion at June 30, 2019. This increase is partially attributed to our growth strategy to increase the number of stores and expand the reach of our banking model which focuses on high levels of customer service and convenience and drives the gathering of low-cost, core deposits. We recognized strong growth in demand deposit balances, including an increase in non-interest bearing demand deposits of 101%, year over year as a result of the successful execution of our strategy. The increase in demand deposits during the second quarter is also a result of our participation in the PPP loan program. When these loans were closed the funds were deposited into Republic Bank checking accounts. These deposits are expected to decline as the borrowers spend the funds on qualified expenses under the program.

Lending

Loans by type are as follows (dollars in thousands):



Description



06/30/20

%
of Total



06/30/19

% of Total



03/31/20

% of
Total

Commercial and industrial

$

224,504

9

%

$

189,632

13

%

$

241,754

13

%

Owner occupied real estate

434,422

17

%

381,852

25

%

436,499

23

%

Commercial real estate

664,605

26

%

553,644

37

%

668,462

36

%

Construction and land develop

150,157

6

%

111,474

7

%

144,215

8

%

Residential mortgage

313,287

12

%

173,963

12

%

287,425

15

%

Paycheck protection program (net)

653,593

26

%

-

-

%

-

-

%

Consumer and other

101,680

4

%

98,155

6

%

103,682

5

%

Gross loans

$

2,542,248

100

%

$

1,508,720

100

%

$

1,882,037

100

%

Gross loans increased by $1.0 billion, or 69%, to $2.5 billion at June 30, 2020 compared to $1.5 billion at June 30, 2019 primarily related to PPP loan originations in the current quarter. In addition, we continue to see results from the continued success with the relationship banking model which has driven a steady flow in quality loan demand over the last twelve months. Excluding the addition of the PPP loans during the second quarter of 2020, loans still grew $380 million, or 25%, when compared to the balance as of June 30, 2019. We experienced strong growth across all loan categories.

Capital

The Company’s capital ratios at June 30, 2020 were as follows:

Actual
06/30/20
Bancorp

Actual
06/30/20
Bank

Regulatory
Guidelines

“Well Capitalized”

Leverage Ratio

7.58%

7.29%

5.00%

Common Equity Ratio

11.01%

11.08%

6.50%

Tier 1 Risk Based Capital

11.51%

11.08%

8.00%

Total Risk Based Capital

12.00%

11.57%

10.00%

Tangible Common Equity

5.65%

5.58%

n/a

Total shareholders’ equity increased to $255 million at June 30, 2020 compared to $251 million at June 30, 2019. Book value per common share increased to $4.34 at June 30, 2020 compared to $4.27 per share at June 30, 2019.

Analyst and Investor Call

An analyst and investor call will be held on the following date and time:

Date:

July 27, 2020

Time:

11:00am (EST)

From the U.S. dial:

(800) 774-6070 [US Toll Free] or

(630) 691-2753 [US Toll]

Participant Pin:

7859 277#

An operator will assist you in joining the call.

About Republic Bank

Republic Bank, a subsidiary of Republic First Bancorp, Inc., is a full-service, state-chartered commercial bank, whose deposits are insured up to the applicable limits by the Federal Deposit Insurance Corporation (FDIC). The Bank provides diversified financial products through its thirty stores located in Greater Philadelphia, Southern New Jersey and New York City. Republic Bank stores are open 7 days a week, 361 days a year, with extended lobby and drive-thru hours providing customers with some of the most convenient hours compared to any bank in its market. The Bank offers free checking, free coin counting, ATM/Debit cards issued on the spot and access to more than 55,000 surcharge free ATMs worldwide via the Allpoint Network. The Bank also offers a wide range of residential mortgage products through its mortgage division which does business under the name of Oak Mortgage Company. For more information about Republic Bank, visit www.myrepublicbank.com.

Forward Looking Statements

The Company may from time to time make written or oral “forward-looking statements”, including statements contained in this release and in the Company's filings with the Securities and Exchange Commission. The forward-looking statements contained herein, are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected in the forward-looking statements. For example, risks and uncertainties can arise with changes in: general economic conditions, including turmoil in the financial markets and related efforts of government agencies to stabilize the financial system; the adequacy of our allowance for loan losses and our methodology for determining such allowance; adverse changes in our loan portfolio and credit risk-related losses and expenses; concentrations within our loan portfolio, including our exposure to commercial real estate loans, and to our primary service area; changes in interest rates; business conditions in the financial services industry, including competitive pressure among financial services companies, new service and product offerings by competitors, price pressures and similar items; deposit flows; loan demand; the regulatory environment, including evolving banking industry standards, changes in legislation or regulation; impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act; our securities portfolio and the valuation of our securities; accounting principles, policies and guidelines as well as estimates and assumptions used in the preparation of our financial statements; rapidly changing technology; litigation liabilities, including costs, expenses, settlements and judgments; the effects of health emergencies, including the spread of infectious diseases and pandemics; and other economic, competitive, governmental, regulatory and technological factors affecting our operations, pricing, products and services. You should carefully review the risk factors described in the Form 10-K for the year ended December 31, 2019, the Form 10-Q for the quarter ended March 31, 2020 and other documents the Company files from time to time with the Securities and Exchange Commission. The words “would be,” “could be,” “should be,” “probability,” “risk,” “target,” “objective,” “may,” “will,” “estimate,” “project,” “believe,” “intend,” “anticipate,” “plan,” “seek,” “expect” and similar expressions or variations on such expressions are intended to identify forward-looking statements. All such statements are made in good faith by the Company pursuant to the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. The Company does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company, except as may be required by applicable law or regulations.

Source: Republic First Bancorp, Inc.

Contact: Frank A. Cavallaro, CFO
(215) 735-4422

Republic First Bancorp, Inc.

Consolidated Balance Sheets

(Unaudited)

June 30,

March 31,

June 30,

(dollars in thousands, except per share amounts)

2020

2020

2019

ASSETS

Cash and due from banks

$

36,786

$

32,581

$

38,770

Interest-bearing deposits and federal funds sold

654,458

23,936

90,744

Total cash and cash equivalents

691,244

56,517

129,514

Securities - Available for sale

382,221

497,511

338,286

Securities - Held to maturity

556,159

611,914

718,534

Restricted stock

3,789

2,746

5,130

Total investment securities

942,169

1,112,171

1,061,950

Loans held for sale

26,126

16,820

23,412

Loans receivable

2,542,248

1,882,037

1,508,720

Allowance for loan losses

(11,040

)

(10,217

)

(8,056

)

Net loans

2,531,208

1,871,820

1,500,664

Premises and equipment

121,149

119,893

105,311

Other real estate owned

1,144

1,144

6,406

Other assets

121,603

122,051

113,729

Total Assets

$

4,434,643

$

3,300,416

$

2,940,986

LIABILITIES

Non-interest bearing deposits

$

1,095,782

$

676,482

$

544,406

Interest bearing deposits

2,548,172

2,267,997

1,983,571

Total deposits

3,643,954

2,944,479

2,527,977

Short-term borrowings

438,478

-

68,979

Subordinated debt

11,268

11,267

11,262

Other liabilities

85,765

92,554

81,410

Total Liabilities

4,179,465

3,048,300

2,689,628

SHAREHOLDERS' EQUITY

Common stock - $0.01 par value

594

594

594

Additional paid-in capital

273,118

272,639

270,789

Accumulated deficit

(10,297

)

(12,809

)

(7,909

)

Treasury stock at cost

(3,725

)

(3,725

)

(3,725

)

Stock held by deferred compensation plan

(183

)

(183

)

(183

)

Accumulated other comprehensive loss

(4,329

)

(4,400

)

(8,208

)

Total Shareholders' Equity

255,178

252,116

251,358

Total Liabilities and Shareholders' Equity

$

4,434,643

$

3,300,416

$

2,940,986


Republic First Bancorp, Inc.

Consolidated Statements of Income

(Unaudited)

Three Months Ended

Six Months Ended

June 30,

March 31,

June 30,

June 30,

June 30,

(in thousands, except per share amounts)

2020

2020

2019

2020

2019

INTEREST INCOME

Interest and fees on loans

$

22,737

$

20,173

$

18,569

$

42,910

$

36,369

Interest and dividends on investment securities

5,072

6,821

7,158

11,893

14,541

Interest on other interest earning assets

50

289

518

339

854

Total interest income

27,859

27,283

26,245

55,142

51,764

INTEREST EXPENSE

Interest on deposits

5,320

6,425

6,695

11,745

12,709

Interest on borrowed funds

112

104

179

216

544

Total interest expense

5,432

6,529

6,874

11,961

13,253

Net interest income

22,427

20,754

19,371

43,181

38,511

Provision for loan losses

1,000

950

-

1,950

300

Net interest income after provision for loan losses

21,427

19,804

19,371

41,231

38,211

NON-INTEREST INCOME

Service fees on deposit accounts

2,328

2,064

1,848

4,392

3,460

Mortgage banking income

3,389

2,458

3,031

5,847

5,251

Gain on sale of SBA loans

269

649

1,147

918

1,649

Gain on sale of investment securities

1,640

841

261

2,481

583

Other non-interest income

798

533

739

1,331

1,028

Total non-interest income

8,424

6,545

7,026

14,969

11,971

NON-INTEREST EXPENSE

Salaries and employee benefits

13,177

13,381

13,705

26,558

26,064

Occupancy and equipment

5,554

5,297

4,221

10,851

8,236

Legal and professional fees

1,009

930

1,058

1,939

1,765

Foreclosed real estate

75

282

517

357

854

Regulatory assessments and related fees

675

630

421

1,305

842

Other operating expenses

6,174

6,752

5,989

12,926

11,417

Total non-interest expense

26,664

27,272

25,911

53,936

49,178

Income (loss) before provision (benefit) for income taxes

3,187

(923

)

486

2,264

1,004

Provision (benefit) for income taxes

675

(330

)

105

345

197

Net income (loss)

$

2,512

$

(593

)

$

381

$

1,919

$

807

Net Income (Loss) per Common Share

Basic

$

0.04

$

(0.01

)

$

0.01

$

0.03

$

0.01

Diluted

$

0.04

$

(0.01

)

$

0.01

$

0.03

$

0.01

Average Common Shares Outstanding

Basic

58,851

58,848

58,841

58,849

58,823

Diluted

58,883

58,848

59,401

58,911

59,501


Republic First Bancorp, Inc.

Average Balances and Net Interest Income

(unaudited)

For the three months ended

For the three months ended

For the three months ended

(dollars in thousands)

June 30, 2020

March 31, 2020

June 30, 2019

Interest

Interest

Interest

Average

Income/

Yield/

Average

Income/

Yield/

Average

Income/

Yield/

Balance

Expense

Rate

Balance

Expense

Rate

Balance

Expense

Rate

Interest-earning assets:

Federal funds sold and other

interest-earning assets

$

198,345

$

50

0.10

%

$

81,339

$

289

1.43

%

$

85,920

$

518

2.42

%

Securities

1,033,560

5,077

1.96

%

1,156,504

6,826

2.36

%

1,067,185

7,184

2.69

%

Loans receivable

2,335,500

22,884

3.94

%

1,808,382

20,319

4.52

%

1,509,177

18,681

4.96

%

Total interest-earning assets

3,567,405

28,011

3.16

%

3,046,225

27,434

3.62

%

2,662,282

26,383

3.97

%

Other assets

266,178

260,829

217,685

Total assets

$

3,833,583

$

3,307,054

$

2,879,967

Interest-bearing liabilities:

Demand non interest-bearing

$

984,771

$

644,601

$

525,336

Demand interest-bearing

1,397,790

2,856

0.82

%

1,337,646

3,421

1.03

%

1,144,783

4,206

1.47

%

Money market & savings

858,782

1,431

0.67

%

752,510

1,783

0.95

%

697,279

1,628

0.94

%

Time deposits

208,838

1,033

1.99

%

226,185

1,221

2.17

%

176,750

861

1.95

%

Total deposits

3,450,181

5,320

0.62

%

2,960,942

6,425

0.87

%

2,544,148

6,695

1.06

%

Total interest-bearing deposits

2,465,410

5,320

0.87

%

2,316,341

6,425

1.12

%

2,018,812

6,695

1.33

%

Other borrowings

45,474

112

0.99

%

11,952

104

3.50

%

19,864

179

3.61

%

Total interest-bearing liabilities

2,510,884

5,432

0.87

%

2,328,293

6,529

1.13

%

2,038,676

6,874

1.35

%

Total deposits and

other borrowings

3,495,655

5,432

0.62

%

2,972,894

6,529

0.88

%

2,564,012

6,874

1.08

%

Non interest-bearing liabilities

83,884

84,211

66,780

Shareholders' equity

254,044

249,949

249,175

Total liabilities and

shareholders' equity

$

3,833,583

$

3,307,054

$

2,879,967

Net interest income

$

22,579

$

20,905

$

19,509

Net interest spread

2.29

%

2.49

%

2.62

%

Net interest margin

2.55

%

2.76

%

2.94

%

Note: The above tables are presented on a tax equivalent basis.


Republic First Bancorp, Inc.

Average Balances and Net Interest Income

(unaudited)

For the six months ended

For the six months ended

(dollars in thousands)

June 30, 2020

June 30, 2019

Interest

Interest

Average

Income/

Yield/

Average

Income/

Yield/

Balance

Expense

Rate

Balance

Expense

Rate

Interest-earning assets:

Federal funds sold and other

interest-earning assets

$

139,842

$

339

0.49

%

$

70,729

$

854

2.43

%

Securities

1,095,032

11,903

2.17

%

1,076,496

14,604

2.71

%

Loans receivable

2,071,941

43,203

4.19

%

1,489,020

36,592

4.96

%

Total interest-earning assets

3,306,815

55,445

3.37

%

2,636,245

52,050

3.98

%

Other assets

263,504

204,344

Total assets

$

3,570,319

$

2,840,589

Interest-bearing liabilities:

Demand non interest-bearing

$

814,686

$

518,790

Demand interest-bearing

1,367,718

6,277

0.92

%

1,129,356

8,144

1.45

%

Money market & savings

805,646

3,214

0.80

%

686,453

3,080

0.90

%

Time deposits

217,512

2,254

2.08

%

165,354

1,485

1.81

%

Total deposits

3,205,562

11,745

0.74

%

2,499,953

12,709

1.03

%

Total interest-bearing deposits

2,390,876

11,745

0.99

%

1,981,163

12,709

1.29

%

Other borrowings

28,713

216

1.51

%

33,341

544

3.29

%

Total interest-bearing liabilities

2,419,589

11,961

0.99

%

2,014,504

13,253

1.33

%

Total deposits and

other borrowings

3,234,275

11,961

0.74

%

2,533,294

13,253

1.05

%

Non interest-bearing liabilities

84,050

59,505

Shareholders' equity

251,994

247,790

Total liabilities and

shareholders' equity

$

3,570,319

$

2,840,589

Net interest income

$

43,484

$

38,797

Net interest spread

2.38

%

2.65

%

Net interest margin

2.64

%

2.97

%

Note: The above tables are presented on a tax equivalent basis.


Republic First Bancorp, Inc.

Summary of Allowance for Loan Losses and Other Related Data

(unaudited)

Year

Three months ended

ended

Six months ended

June 30,

March 31,

June 30,

Dec 31

June 30,

June 30,

(dollars in thousands)

2020

2020

2019

2019

2020

2019

Balance at beginning of period

$

10,217

$

9,266

$

7,900

$

8,615

$

9,266

$

8,615

Provision charged to operating expense

1,000

950

-

1,905

1,950

300

11,217

10,216

7,900

10,520

11,216

8,915

Recoveries on loans charged-off:

Commercial

14

17

154

219

31

155

Consumer

1

6

3

9

7

4

Total recoveries

15

23

157

228

38

159

Loans charged-off:

Commercial

(149

)

-

(1

)

(1,356

)

(149

)

(930

)

Consumer

(43

)

(22

)

-

(126

)

(65

)

(88

)

Total charged-off

(192

)

(22

)

(1

)

(1,482

)

(214

)

(1,018

)

Net (charge-offs) recoveries

(177

)

1

156

(1,254

)

(176

)

(859

)

Balance at end of period

$

11,040

$

10,217

$

8,056

$

9,266

$

11,040

$

8,056

Net (charge-offs) recoveries as a percentage of

average loans outstanding

0.03

%

(0.00

%)

(0.04

%)

0.08

%

0.02

%

0.12

%

Allowance for loan losses as a percentage

of period-end loans

0.43

%

0.54

%

0.53

%

0.53

%

0.43

%

0.53

%


Republic First Bancorp, Inc.

Summary of Non-Performing Loans and Assets

(unaudited)

June 30,

March 31,

December 31,

September 30,

June 30,

(dollars in thousands)

2020

2020

2019

2019

2019

Non-accrual loans:

Commercial real estate

$

10,747

$

12,060

$

10,569

$

10,180

$

7,545

Consumer and other

1,970

2,125

1,844

1,743

1,777

Total non-accrual loans

12,717

14,185

12,413

11,923

9,322

Loans past due 90 days or more

and still accruing

-

-

-

129

-

Total non-performing loans

12,717

14,185

12,413

12,052

9,322

Other real estate owned

1,144

1,144

1,730

6,653

6,406

Total non-performing assets

$

13,861

$

15,329

$

14,143

$

18,705

$

15,728

Non-performing loans to total loans

0.50

%

0.75

%

0.71

%

0.77

%

0.62

%

Non-performing assets to total assets

0.31

%

0.46

%

0.42

%

0.61

%

0.53

%

Non-performing loan coverage

86.81

%

72.03

%

74.65

%

70.25

%

86.42

%

Allowance for loan losses as a percentage

of total period-end loans

0.43

%

0.54

%

0.53

%

0.54

%

0.43

%

Non-performing assets / capital plus

allowance for loan losses

5.21

%

5.84

%

5.47

%

7.21

%

6.05

%