Republic First Bancorp, Inc. Reports Asset Growth Of 19%; Deposits Increase By 17%

Jan 25, 2016, 14:41 ET from Republic First Bancorp, Inc.

PHILADELPHIA, Jan. 25, 2016 /PRNewswire/ -- Republic First Bancorp, Inc. (NASDAQ: FRBK), the holding company for Republic Bank, today announced its financial results for the period ended December 31, 2015.

 

 

Three Months Ended

($ in millions, except per share data)

12/31/15

12/31/14

% Change

Assets

$ 1,439.4

$    1,214.6

19%

Loans

874.8

781.9

12%

Deposits

1,249.3

1,072.2

17%

Total Revenue

$     15.7

$        12.0

31%

Net Income

0.8

0.9

(7%)

Net Income per Share

$     0.02

$        0.02

0%

"The fourth quarter brings a close to a very successful year for Republic Bank," said Harry D. Madonna, the Company's Chairman and Chief Executive Officer. "The new stores we've opened in Glassboro, Marlton and Berlin during 2015 have performed exceptionally well. We ended the year with stores under construction in Washington Township, NJ and Wynnewood, PA and several more in various stages of development for future openings."

"We continue to expand our presence in the Philadelphia region through an aggressive growth strategy which we refer to as 'The Power of Red is Back'," added Madonna. "Each day we welcome new fans into our stores and win them over with exceptional customer service. The growth in both loan and deposit balances clearly demonstrates our ongoing success with this strategy.  While we continue to make significant investments to build a new bank, we are very pleased with our ability to maintain consistent, profitable results from an income statement perspective."

The Company is in the midst of an aggressive expansion plan with the goal of increasing its store footprint while providing legendary customer service. There are currently seventeen stores serving customers in the Greater Philadelphia and Southern New Jersey region.  Additional stores are planned for Cherry Hill, Gloucester Township, Medford, Moorestown, Washington Township and Wynnewood.

Highlights for the Period Ended December 31, 2015

  • During the fourth quarter of 2015 the Company recognized income of $2.6 million related to an insurance settlement on an outstanding claim against a corporate policy.  During the quarter the Company also recorded a write-down of approximately $2.2 million against its largest OREO asset as a result of a decision to aggressively pursue a sale of this property below its appraised value.
  • Republic opened three new stores during 2015 and currently has two sites under construction scheduled to be completed in early 2016. There are also several additional sites in various stages of development for future store locations.
  • New stores opened within the last 2 years are currently growing deposits at an average rate of $34 million per year, while the average deposit growth for all stores over the last twelve months was approximately $12 million per store. 
  • Total deposits increased by $177 million, or 17%, to $1.2 billion as of December 31, 2015 compared to $1.1 billion as of December 31, 2014.
  • Non-interest bearing demand deposits increased by 9% to $244 million as of December 31, 2015 compared to $224 million as of December 31, 2014.
  • Total assets increased by $225 million, or 19%, to $1.4 billion as of December 31, 2015 compared to $1.2 billion as of December 31, 2014.
  • Total loans grew $93 million, or 12%, to $875 million as of December 31, 2015 compared to $782 million at December 31, 2014.
  • SBA lending continued to be a focal point of the Company's lending strategy. More than $8 million in new SBA loans were originated during the three month period ended December 31, 2015. Our team is currently ranked as the #1 SBA lender in the tri-state market of New Jersey, Pennsylvania and Delaware based on the dollar volume of loan originations.
  • The Company's Total Risk-Based Capital ratio was 13.19% and Tier I Leverage Ratio was 9.65% at December 31, 2015.
  • Tangible book value per share was $3.00 as of December 31, 2015. This amount excludes approximately $0.37 per share attributable to the deferred tax asset valuation allowance.

Income Statement

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

Three Months Ended

Twelve Months Ended

12/31/15

12/31/14

% Change

12/31/15

12/31/14

% Change

Total Revenue

$  15,727

$   11,967

31%

$  49,998

$   43,846

14%

Provision for Loan Losses

500

300

67%

500

900

(44%)

Non-interest Expenses

14,446

10,792

34%

47,091

40,550

16%

Net Income

790

853

(7%)

2,433

2,442

0%

Net Income per Share

$       0.02

$        0.02

0%

$      0.06

$      0.07

(14%)

The Company reported net income of $790 thousand, or $0.02 per share, for the three month period ended December 31, 2015, compared to net income of $853 thousand, or $0.02 per share, for the three month period ended December 31, 2014.

Net interest income increased by $1.4 million, or 15%, to $11.0 million for the three month period ended December 31, 2015 compared to $9.5 million for the three month period ended December 31, 2014.  This increase was driven by strong growth in interest-earning assets over the last twelve months.

Non-interest income increased to $4.7 million for the three month period ended December 31, 2015 compared to $2.4 million for the three month period ended December 31, 2014.  This increase was primarily driven by a $2.6 million insurance settlement recorded in the fourth quarter of 2015.  This settlement is related to a bond claim against a corporate insurance policy originally submitted in 2010.

Non-interest expenses increased by $3.7 million to $14.4 million during the three month period ended December 31, 2015 compared to $10.8 million during the three months ended December 31, 2014. This increase was primarily driven by an increase in writedowns of OREO assets. During the fourth quarter of 2015 the Company made a decision to aggressively pursue a potential sale of its largest OREO asset resulting in a write-down of approximately $2.2 million. Higher salaries, employee benefits, occupancy and equipment expenses associated with the addition of new stores related to the Company's expansion strategy over the last twelve months also contributed to the increase in non-interest expenses.

Net income for the twelve month period ended December 31, 2015 was $2.4 million, or $0.06 per share, compared to net income of $2.4 million, or $0.07 per share, for the twelve months ended December 31, 2014.

Total revenue increased by 14% to $50.0 million for the twelve month period ended December 31, 2015 compared to $43.8 million for the twelve month period ended December 31, 2014 as a result of strong growth in interest-earning assets over the last twelve months along with the insurance settlement described above.  Non-interest expenses grew $6.5 million year over year due to the increase in OREO writedowns combined with higher salaries, employee benefits, and occupancy and equipment expenses associated with the addition of new stores during 2015.

Balance Sheet

The major components of the balance sheet are as follows (dollars in thousands):

Description

12/31/15

12/31/14

% Change

09/30/15

% Change

Total assets

$ 1,439,443

$ 1,214,598

19%

$ 1,380,814

4%

Total loans (net)

866,066

770,404

12%

837,037

3%

Total deposits

1,249,298

1,072,230

17%

1,237,496

1%

Total core deposits

1,239,422

1,061,994

17%

1,227,506

1%

Total assets increased by $224.8 million, or 19%, as of December 31, 2015 when compared to December 31, 2014.  Deposits grew by $177.1 million to $1.2 billion as of December 31, 2015 compared to $1.1 billion as of December 31, 2014. The number of deposit accounts has grown by 44% during the past twelve months. The strong growth in assets, loans and deposits has been driven by the Company's successful execution of its aggressive growth strategy referred to as "The Power of Red is Back."

Core Deposits

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

Description

12/31/15

12/31/14

% Change

09/30/15

% Change

4th Qtr 2015 Cost of Funds

Demand noninterest-bearing

$ 243,696

$ 224,245

9%

$ 243,836

0%

0.00%

Demand interest-bearing

381,499

283,768

34%

391,230

(2%)

0.40%

Money market and savings

556,525

488,848

14%

527,360

6%

0.41%

Certificates of deposit

57,702

65,133

(11%)

65,080

(11%)

0.78%

Total core deposits

$ 1,239,422

$1,061,994

17%

$ 1,227,506

1%

0.34%

Core deposits increased to $1.2 billion at December 31, 2015 compared to $1.1 billion at December 31, 2014 as the Company moves forward with its expansion strategy to increase the number of brick and mortar stores which drives the gathering of low-cost core deposits. The Company recognized strong growth in demand, money market and savings account balances on a year to year basis.

Lending

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

Description

12/31/15

% of Total

12/31/14

% of Total

09/30/15

% of

Total

Commercial real estate

$ 349,726

40%

$ 379,259

48%

$377,307

45%

Construction and land development

46,547

5%

29,861

4%

41,418

5%

Commercial and industrial

181,850

21%

145,113

19%

174,631

21%

Owner occupied real estate

246,398

28%

188,025

24%

203,735

24%

Consumer and other

48,126

6%

39,713

5%

46,136

5%

Residential mortgage

2,380

0%

408

0%

2,395

0%

Deferred fees

(258)

(439)

(262)

Gross loans

$874,769

100%

$781,940

100%

$845,360

100%

Gross loans increased by $92.8 million, or 12%, to $874.8 million at December 31, 2015 compared to $781.9 million at December 31, 2014 as a result of an increase in quality loan demand over the last twelve months and continued success with the relationship banking model.  The Company experienced strongest growth in the commercial and industrial and owner occupied real estate categories.

Asset Quality

The Company's non-performing asset balances and asset quality ratios are highlighted below:

Three Months Ended

12/31/15

09/30/15

12/31/14

Non-performing assets / total assets

1.66%

2.10%

2.07%

Quarterly net loan charge-offs / average loans

0.06%

0.04%

0.51%

Allowance for loan losses / gross loans

0.99%

0.98%

1.48%

Allowance for loan losses / non-performing loans

69%

55%

54%

Non-performing assets / capital and reserves

20%

24%

20%

The percentage of non-performing assets to total assets decreased to 1.66% at December 31, 2015, compared to 2.07% as of December 31, 2014. Non-performing loans to total loans decreased significantly to 1.44% at December 31, 2015 compared to 2.74% at December 31, 2014 as a result of the successful migration of certain assets to the other real estate owned category through the work-out process.

Capital

The Company's capital ratios at December 31, 2015 were as follows:

Actual

December 31, 2015

Regulatory Guidelines

"Well Capitalized"

Leverage Ratio

9.65%

5.00%

Common Equity Ratio

10.42%

6.50%

Tier 1 Risk Based Capital

12.40%

8.00%

Total Risk Based Capital

13.19%

10.00%

Tangible Common Equity

7.88%

                              n/a

Total shareholders' equity increased to $113.4 million at December 31, 2015 compared to $112.8 million at December 31, 2014.  Tangible book value per share increased to $3.00 at December 31, 2015 compared to $2.98 per share at December 31, 2014.

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 seventeen stores located in Abington, Ardmore, Bala Cynwyd, Plymouth Meeting, Media and Philadelphia, Pennsylvania and Haddonfield, Cherry Hill, Voorhees, Glassboro, Marlton and Berlin, New Jersey.  Republic Bank stores are open 7 days a week, 361 days a year, with extended lobby and drive-thru hours providing customers with the most convenient hours compared to any bank in its market.  The Bank also 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.  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; 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, 2014 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.

 

Republic First Bancorp, Inc.

Consolidated Balance Sheets

(Unaudited)

December 31,

September 30,

December 31,

(dollars in thousands, except per share amounts)

2015

2015

2014

ASSETS

Cash and due from banks

$         13,777

$         14,212

$         14,822

Interest-bearing deposits and federal funds sold

13,362

96,307

114,004

Total cash and cash equivalents

27,139

110,519

128,826

Securities - Available for sale

284,795

209,119

185,379

Securities - Held to maturity

172,277

140,116

67,866

Restricted stock

3,059

1,179

1,157

Total investment securities

460,131

350,414

254,402

Loans held for sale

3,653

489

1,676

Loans receivable

874,769

845,360

781,940

Allowance for loan losses

(8,703)

(8,323)

(11,536)

Net loans

866,066

837,037

770,404

Premises and equipment

46,164

45,094

35,030

Other real estate owned

11,313

13,773

3,715

Other assets

24,977

23,488

20,545

Total Assets

$    1,439,443

$    1,380,814

$    1,214,598

LIABILITIES

Non-interest bearing deposits

$       243,695

$       243,836

$       224,245

Interest bearing deposits

1,005,603

993,660

847,985

Total deposits

1,249,298

1,237,496

1,072,230

Short-term borrowings

47,000

-

-

Subordinated debt

22,476

22,476

22,476

Other liabilities

7,294

6,369

7,081

Total Liabilities

1,326,068

1,266,341

1,101,787

SHAREHOLDERS' EQUITY

Common stock - $0.01 par value

384

383

383

Additional paid-in capital

152,897

152,676

152,234

Accumulated deficit

(32,833)

(33,623)

(35,266)

Treasury stock at cost

(3,725)

(3,725)

(3,725)

Stock held by deferred compensation plan

(183)

(183)

(183)

Accumulated other comprehensive income (loss)

(3,165)

(1,055)

(632)

Total Shareholders' Equity

113,375

114,473

112,811

Total Liabilities and Shareholders' Equity

$    1,439,443

$    1,380,814

$    1,214,598

 

 

Republic First Bancorp, Inc.

Consolidated Statements of Operations

(Unaudited)

Three Months Ended

Twelve Months Ended

December 31,

September 30,

December 31,

December 31,

December 31,

(in thousands, except per share amounts)

2015

2015

2014

2015

2014

INTEREST INCOME

Interest and fees on loans

$          9,786

$          9,648

$          9,236

$        37,781

$        34,869

Interest and dividends on investment securities

2,565

1,662

1,470

7,377

5,417

Interest on other interest earning assets

55

60

80

278

187

Total interest income

12,406

11,370

10,786

45,436

40,473

INTEREST EXPENSE

Interest on deposits

1,137

1,099

968

4,266

3,536

Interest on borrowed funds

282

279

278

1,115

1,108

Total interest expense

1,419

1,378

1,246

5,381

4,644

Net interest income

10,987

9,992

9,540

40,055

35,829

Provision for loan losses

500

-

300

500

900

Net interest income after provision for loan losses

10,487

9,992

9,240

39,555

34,929

NON-INTEREST INCOME

Service fees on deposit accounts

506

452

328

1,719

1,224

Gain on sale of SBA loans

455

884

1,903

3,139

4,717

Gain on sale of investment securities

35

64

-

108

458

Other non-interest income

3,744

204

196

4,977

1,618

Total non-interest income

4,740

1,604

2,427

9,943

8,017

NON-INTEREST EXPENSE

Salaries and employee benefits

5,821

5,730

5,147

22,488

20,089

Occupancy and equipment

2,259

1,911

1,746

8,009

6,629

Legal and professional fees

584

345

615

2,183

2,758

Foreclosed real estate

3,066

425

732

4,239

1,794

Regulatory assessments and related fees

337

318

274

1,248

1,065

Other operating expenses

2,379

2,295

2,278

8,924

8,215

Total non-interest expense

14,446

11,024

10,792

47,091

40,550

Income before benefit for income taxes

781

572

875

2,407

2,396

Benefit for income taxes

(9)

(10)

22

(26)

(46)

Net income

$             790

$             582

$             853

$          2,433

$          2,442

Net Income per Common Share

Basic

$            0.02

$            0.02

$            0.02

$            0.06

$            0.07

Diluted

$            0.02

$            0.02

$            0.02

$            0.06

$            0.07

Average Common Shares Outstanding

Basic

37,826

37,816

37,815

37,818

34,232

Diluted

38,246

38,064

38,121

38,094

34,591

 

 

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)

December 31, 2015

September 30, 2015

December 31, 2014

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

$     65,611

$      55

0.33%

$   106,357

$      60

0.22%

$   122,787

$      80

0.26%

Securities

409,141

2,656

2.60%

305,266

1,745

2.29%

234,479

1,527

2.60%

Loans receivable

855,124

9,870

4.58%

831,712

9,718

4.64%

757,953

9,283

4.86%

Total interest-earning assets

1,329,876

12,581

3.75%

1,243,335

11,523

3.68%

1,115,219

10,890

3.87%

Other assets

85,340

82,638

55,997

Total assets

$1,415,216

$1,325,973

$1,171,216

Interest-bearing liabilities:

Demand non interest-bearing

$   252,514

$   234,285

$   214,872

Demand interest-bearing

393,384

392

0.40%

372,795

378

0.40%

258,443

252

0.39%

Money market & savings

552,673

578

0.41%

500,687

538

0.43%

478,651

537

0.45%

Time deposits

71,463

167

0.93%

74,863

183

0.97%

76,756

179

0.93%

Total deposits

1,270,034

1,137

0.36%

1,182,630

1,099

0.37%

1,028,722

968

0.37%

Total interest-bearing deposits

1,017,520

1,137

0.44%

948,345

1,099

0.46%

813,850

968

0.47%

Other borrowings

23,087

282

4.85%

22,476

279

4.92%

22,689

278

4.86%

Total interest-bearing liabilities

1,040,607

1,419

0.54%

970,821

1,378

0.56%

836,539

1,246

0.59%

Total deposits and 

  other borrowings

1,293,121

1,419

0.44%

1,205,106

1,378

0.45%

1,051,411

1,246

0.47%

Non interest-bearing liabilities

7,901

7,034

7,427

Shareholders' equity

114,194

113,833

112,378

Total liabilities and

shareholders' equity

$1,415,216

$1,325,973

$1,171,216

Net interest income

$11,162

$10,145

$ 9,644

Net interest spread

3.21%

3.12%

3.28%

Net interest margin

3.33%

3.24%

3.43%

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

 

 

Republic First Bancorp, Inc.

Average Balances and Net Interest Income

(unaudited)

For the twelve months ended

For the twelve months ended

(dollars in thousands)

December 31, 2015

December 31, 2014

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

$   106,876

$     278

0.26%

$     75,593

$     187

0.25%

Securities

309,018

7,692

2.49%

217,939

5,613

2.58%

Loans receivable

820,820

38,072

4.64%

724,231

35,052

4.84%

Total interest-earning assets

1,236,714

46,042

3.72%

1,017,763

40,852

4.01%

Other assets

74,505

50,302

Total assets

$1,311,219

$1,068,065

Interest-bearing liabilities:

Demand non interest-bearing

$   235,810

$   189,810

Demand interest-bearing

349,055

1,401

0.40%

233,693

888

0.38%

Money market & savings

508,846

2,170

0.43%

439,484

1,929

0.44%

Time deposits

73,819

695

0.94%

78,073

719

0.92%

Total deposits

1,167,530

4,266

0.37%

941,060

3,536

0.38%

Total interest-bearing deposits

931,720

4,266

0.46%

751,250

3,536

0.47%

Other borrowings

22,640

1,115

4.92%

22,530

1,108

4.92%

Total interest-bearing liabilities

954,360

5,381

0.56%

773,780

4,644

0.60%

Total deposits and 

  other borrowings

1,190,170

5,381

0.45%

963,590

4,644

0.48%

Non interest-bearing liabilities

7,340

7,084

Shareholders' equity

113,709

97,391

Total liabilities and

shareholders' equity

$1,311,219

$1,068,065

Net interest income

$40,661

$36,208

Net interest spread

3.16%

3.41%

Net interest margin

3.29%

3.56%

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)

Three months ended

 

Twelve months ended

December 31,

September 30,

December 31,

December 31,

December 31,

(dollars in thousands)

2015

2015

2014

2015

2014

Balance at beginning of period

$         8,323

$         8,398

$       12,216

$       11,536

$       12,263

Provision charged to operating expense

500

-

300

500

900

8,823

8,398

12,516

12,036

13,163

Recoveries on loans charged-off:

  Commercial

1

2

120

58

385

  Consumer

1

1

-

34

-

Total recoveries

2

3

120

92

385

Loans charged-off:

  Commercial

(122)

(78)

(1,100)

(3,425)

(2,002)

  Consumer

-

-

-

-

(10)

Total charged-off

(122)

(78)

(1,100)

(3,425)

(2,012)

Net charge-offs

(120)

(75)

(980)

(3,333)

(1,627)

Balance at end of period

$         8,703

$         8,323

$       11,536

$         8,703

$       11,536

Net charge-offs as a percentage of

  average loans outstanding

0.06%

0.04%

0.51%

0.41%

0.22%

Allowance for loan losses as a percentage

  of period-end loans

0.99%

0.98%

1.48%

0.99%

1.48%

 

Republic First Bancorp, Inc. 

Summary of Non-Performing Loans and Assets

(unaudited)

December 31,

September 30,

June 30,

March 31,

December 31,

(dollars in thousands)

2015

2015

2015

2015

2014

Non-accrual loans:

  Commercial real estate

$        12,080

$        13,825

$        15,559

$        19,530

$        21,011

  Consumer and other

542

547

418

426

429

Total non-accrual loans

12,622

14,372

15,977

19,956

21,440

Loans past due 90 days or more

  and still accruing

-

844

256

5,013

-

Total non-performing loans

12,622

15,216

16,233

24,969

21,440

Other real estate owned

11,313

13,773

13,162

3,827

3,715

Total non-performing assets

$        23,935

$        28,989

$        29,395

$        28,796

$        25,155

Non-performing loans to total loans

1.44%

1.80%

1.97%

3.17%

2.74%

Non-performing assets to total assets

1.66%

2.10%

2.31%

2.28%

2.07%

Non-performing loan coverage

68.95%

54.70%

51.73%

43.83%

53.81%

Allowance for loan losses as a percentage

  of total period-end loans

0.99%

0.98%

1.02%

1.39%

1.48%

Non-performing assets / capital plus

   allowance for loan losses

19.61%

23.61%

24.13%

23.07%

20.23%

 

Logo - http://photos.prnewswire.com/prnh/20100707/PH31611LOGO

 

 

SOURCE Republic First Bancorp, Inc.



RELATED LINKS

http://www.myrepublicbank.com