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Republic First Bancorp Inc (FRBK) SEC Filing 8-K Material Event for the period ending Thursday, January 20, 2022

Republic First Bancorp Inc

CIK: 834285 Ticker: FRBK

Exhibit 99.1

 

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News Release

Republic First Bancorp, Inc.

January 20, 2022

 

 

REPUBLIC FIRST BANCORP, INC. REPORTS FOURTH QUARTER FINANCIAL RESULTS

YTD NET INCOME INCREASES BY 398% TO $25 MILLION AND DEPOSITS GROW 29%

 

Philadelphia, PA, January 20, 2022 (GlobeNewswire) – Republic First Bancorp, Inc. (NASDAQ: FRBK), the holding company for Republic Bank, today announced its financial results for the period ended December 31, 2021.

 

Q4-2021 Financial Highlights

 

  Q4-2021 Financial Highlights  
       
 
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Net income for the twelve-month period ended December 31, 2021 increased by 398% to $25.2 million, or $0.33 per diluted share, compared to net income of $5.1 million, or $0.07 per diluted share, for the twelve-month period ended December 31, 2020.

 
       
 
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Net income for the quarter ended December 31, 2021 increased to $6.1 million, or $0.08 per diluted share, compared to net income of $4.1 million, or $0.05 per diluted share, for the quarter ended December 31, 2020.  
       
 
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The improvement in earnings was driven by strong growth in revenue while our focus on cost control initiatives continues to limit expense growth. During the twelve-month period ended December 31, 2021 total revenue increased 26% and non-interest expense increased by only 4%.  
       
 
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Total deposits increased by $1.2 billion, or 29%, to $5.2 billion as of December 31, 2021 compared to $4.0 billion as of December 31, 2020. New stores opened since the beginning of the “Power of Red is Back expansion campaign are currently growing deposits at an average rate of $41 million per year, while the average deposit growth for all stores over the last twelve months was approximately $37 million per store.  
       
 
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We have achieved this significant growth in deposits while driving down the overall cost of funds for the Bank. The cost of funds decreased to 0.35% during the fourth quarter of 2021 compared to 0.54% in the fourth quarter of 2020.  
       
 
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Excluding the impact of PPP loans, total loans grew $372 million, or 18%, to $2.4 billion as of December 31, 2021 compared to $2.0 billion at December 31, 2020.  
       
 
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Asset quality remains strong as the ratio of non-performing assets to total assets declined to 0.24% as of December 31, 2021 compared to 0.28% as of December 31, 2020. No loan customers were deferring loan payments at the end of the fourth quarter. All customers that were granted deferrals to assist during the height of the COVID pandemic have resumed contractual payments.  
       

 

 

 

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

 

“I am pleased to report Republic Bank’s fourth quarter financial results, which brings to a close a very successful year for ‘The Power of Red is Back’ expansion campaign. We not only achieved asset, loan and deposit growth far above industry standards, but we also saw a dramatic improvement in profitability during the current year. Earnings improved by nearly 400% year over year as a result of our efforts to drive revenue growth at a greater rate than expense growth.”

 

“As we look forward to the year ahead, we are very excited about the opportunities that we see unfolding in 2022 that will enable us to continue our successful growth strategy. We also plan to deliver significant enhancements to our digital and technology platforms in 2022. We remain committed to delivering the best experience to our customers across all delivery channels which includes in-store, online, mobile and by phone.”

 

“On our previous earnings call we mentioned the possibility of completing a capital raise during the fourth quarter of 2021 to support our growth and expansion strategy. As the quarter progressed, we made the determination that it would be in the best interest of the Company and our shareholders to execute a capital raise at a time that would be most optimal from a stock price perspective. We will continue to monitor market conditions and alternative strategies as we enter 2022.”

 

 

Financial Summary for the Period Ended December 31, 2021

 

The changes in the balance sheet as of December 31, 2021 were impacted by the effect of the PPP loan program. A portion of the changes in cash balances, outstanding loans, and outside borrowings were short-term in nature and declined as the borrowers that received PPP loans submitted applications for forgiveness to the SBA. A summary of the balance sheet presented with and without the impact of the PPP loan program for the period ended December 31, 2021 can be found in the following table:

 

($ in millions)

 

Actual

   

Actual

   

Actual

   

YOY Growth

 
   

12/31/21

   

09/30/21

   

12/31/20

    $ ($)       (%)  

Assets

  $ 5,627     $ 5,406     $ 5,066     $ 561       11 %

Assets (excluding PPP)*

    5,512       5,157       4,432       1,070       24 %

Loans

    2,507       2,497       2,645       (138 )     (5 %)

Loans (excluding PPP)*

    2,393       2,258       2,021       372       18 %

Deposits

    5,191       4,972       4,014       1,177       29 %

PPPLF Borrowings

    -       -       634       (634 )     (100 %)

 

*Note: See disclosure related to non-GAAP financial measures at the end of this release.

 

2

 

 

A summary of the income statement for the period ended December 31, 2021 can be found in the following table:

 

($ in millions, except

 

Three Months Ended

   

Twelve Months Ended

 

per share data)

 

12/31/21

   

12/31/20

   

Change

   

12/31/21

   

12/31/20

   

Change

 

Total Revenue

  $ 43.2     $ 37.0       17 %   $ 162.0     $ 128.1       26 %

Non-Interest Expense

    32.9       29.9       10 %     122.5       117.4       4 %

Income Before Tax

    8.5       5.6       50 %     33.7       6.4       423 %

Net Income

    6.1       4.1       49 %     25.2       5.1       398 %

Earnings per share (diluted)

  $ 0.08     $ 0.05       60 %   $ 0.33     $ 0.07       371 %

 

 

Additional Financial Highlights

 

 
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Total assets increased by $561 million, or 11%, to $5.6 billion as of December 31, 2021 compared to $5.1 billion as of December 31, 2020. Excluding the short-term impact of the PPP loan program total assets increased by $1.1 billion, or 24%, year over year.

 

 
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The net interest margin increased by 17 basis points to 2.68% for the twelve months ended December 31, 2021 compared to 2.51% for the twelve months ended December 31, 2020. This increase was primarily driven by a decline in the cost of funds during 2021.

 

 
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The cost of funds declined to 0.40% for the twelve-month period ended December 31, 2021 compared to 0.64% for the twelve month period ended December 31, 2020. This decrease was driven by the lower cost of deposits which has occurred while deposit balances have grown by $1.2 billion year over year.

 

 
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We have thirty-three convenient store locations open today. We recently opened our newest store in Ocean City, NJ on January 15, 2022. Construction is also ongoing on sites in Wayne, PA and Broomall, PA which we expect will also open during 2022.

 

 
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Our residential mortgage division, Oak Mortgage, is serving the home financing needs of customers throughout its footprint. The Oak Mortgage team originated more than $579.8 million in mortgage loans over the last twelve months which continues to be near record highs for the Oak Mortgage Team.

 

 
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Total Risk-Based Capital ratio was 11.76% and Tier I Leverage Ratio was 6.06% at December 31, 2021.

 

 
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Book value per common share increased to $4.67 as of December 31, 2021 compared to $4.41 as of December 31, 2020.

 

3

 

 

Income Statement

 

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

 

   

Three Months Ended

 
   

12/31/21

   

09/30/21

   

%

Change

   

12/31/20

   

%

Change

 

Net Interest Income

  $ 35,701     $ 31,442       14 %   $ 25,720       39 %

Non-interest Income

    7,471       7,315       2 %     11,236       (34 %)

Total Revenue

    43,172       38,757       11 %     36,956       17 %

Provision for Loan Losses

    1,850       900       106 %     1,400       32 %

Non-interest Expense

    32,866       29,773       10 %     29,907       10 %

Income Before Taxes

    8,456       8,084       5 %     5,649       50 %

Provision for Income Taxes

    2,379       1,988       20 %     1,548       54 %

Net Income

    6,077       6,096       - %     4,101       48 %

Preferred Stock Dividend

    875       875       - %     924       (5 %)

Net Income Attributable to Common Shareholders

    5,202       5,221       - %     3,177       64 %

Earnings (Loss) per share

  $ 0.08     $ 0.08       - %   $ 0.05       60 %

 

Net income increased to $6.1 million, or $0.08 per share, for the three-month period ended December 31, 2021, compared to net income of $4.1 million, or $0.05 per share, for the three-month period ended December 31, 2020.

 

We continue to demonstrate progress with operating leverage, which drives improved earnings. Total revenue increased by 17% while non-interest expense increased by 10% during the fourth quarter of 2021, compared to the fourth quarter of 2020.

 

Net interest income increased to $35.7 million during the fourth quarter of 2021 compared to $25.7 million during the fourth quarter of 2020. The increase in interest income is attributable to the growth in interest-earning assets over the last twelve months driven by the “Power of Red is Back” expansion strategy. We also continue to amortize the fees associated with the origination of PPP loans which is reported as interest income and is recognized over the life of those loans. Approximately $5.2 million in origination fees related to the PPP loan program were recognized as income during the fourth quarter of 2021 compared to $3.0 million recognized during the fourth quarter of 2020.

 

The net interest margin for the three-month period ended December 31, 2021 increased by 20 basis points to 2.63% compared to 2.43% for the three month period ended December 31, 2020. The net interest margin increased by 6 basis points on a linked quarter basis primarily as a result of an increase in the yield on interest earning assets during the fourth quarter of 2021.

 

4

 

The provision for loan losses increased to $1.9 million during the fourth quarter of 2021 compared to $1.4 million during the fourth quarter of 2020. The increase was primarily driven by a specific reserve required for a single loan relationship which we received updated information on during the current period.

 

Non-interest income declined to $7.5 million during the quarter ended December 31, 2021, compared to $11.2 million during the quarter ended December 31, 2020. The decrease is primarily attributable to the decrease in mortgage banking income year over year as a result of a decline in residential mortgage loan originations driven by lower refinancing activity in the current period.

 

Non-interest expense increased by 10%, to $32.9 million during the quarter ended December 31, 2021, compared to $29.9 million during the quarter ended December 31, 2020. The year over year growth was primarily driven by an increase in salary and benefit costs and data processing expense as a result of the overall growth of the Bank.

 

A dividend on the outstanding shares of preferred stock in the amount of $0.9 million was declared and paid during the fourth quarter of 2021. The preferred stock was initially issued in August 2020 and pays a dividend at an annual rate of 7.00%.

 

    Twelve Months Ended  
   

12/31/21

   

12/31/20

   

%

Change

 

Net Interest Income

  $ 129,216     $ 91,832       41 %

Non-interest Income

    32,740       36,235       (10 %)

Total Revenue

    161,956       128,067       26 %

Provision for Loan Losses

    5,750       4,200       37 %

Non-interest Expense

    122,504       117,423       4 %

Income Before Taxes

    33,702       6,444       423 %

Provision (Benefit) for Taxes

    8,526       1,390       513 %

Net Income

    25,176       5,054       398 %

Preferred Stock Dividend

    3,500       923       279 %

Net Income Attributable to Common Shareholders

    21,676       4,131       425 %

Earnings per share

  $ 0.33     $ 0.07       371 %

 

Net income increased by 398% to $25.2 million, or $0.33 per share, for the twelve-month period ended December 31, 2021, compared to net income of $5.1 million, or $0.07 per share, for the twelve-month period ended December 31, 2020. Improved operating leverage also drove better earnings during the twelve-month period ended December 31, 2021, as total revenue increased by 26% while non-interest expense increased by only 4%, during the full year in 2021 compared to 2020.

 

5

 

Net interest income increased to $129.2 million during the twelve-month period ended December 31, 2021 compared to $91.8 million during the twelve-month period ended December 31, 2020. The increase in interest income is attributable to the growth in interest-earning assets over the last twelve months driven by the “Power of Red is Back” expansion strategy. We also continue to amortize the fees associated with the origination of PPP loans which is reported as interest income and is recognized over the life of the loans. The net interest margin for the twelve-month period ended December 31, 2021 increased by 17 basis points to 2.68% compared to 2.51% for the twelve-month period ended December 31, 2020. The improvement in the margin was primarily a result of a decline in the cost of funds to 0.40% during 2021 compared to 0.64% during 2020.

 

Non-interest income decreased by $3.5 million, or 10%, to $32.7 million for the twelve-month period ended December 31, 2021, compared to $36.2 million for the twelve-month period ended December 31, 2020. Growth in service fees and ATM/debit card revenue was offset by decreases in mortgage banking income and gains on the sale of investment securities during 2021.

 

Non-interest expense increased by 4%, to $122.5 million during the twelve months ended December 31, 2021, compared to $117.4 million during the twelve months ended December 31, 2020. The year over year growth was driven by increases in salary and benefit costs, occupancy and equipment and data processing expense as a result of the growth and expansion of the Bank.

 

 

Deposits

 

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

 

Description

 

12/31/21

   

12/31/20

   

%

Change

   

09/30/21

   

%

Change

 
                                         

Demand noninterest-bearing

  $ 1,404,360     $ 1,006,876       39 %   $ 1,346,353       4 %

Demand interest-bearing

    2,283,779       1,776,995       29 %     2,162,324       6 %

Money market and savings

    1,305,096       1,043,519       25 %     1,265,926       3 %

Certificates of deposit

    197,945       186,361       6 %     197,478       - %

Total deposits

  $ 5,191,180     $ 4,013,751       29 %   $ 4,972,081       4 %

 

Deposits increased by $1.2 billion, or 29%, to $5.2 billion at December 31, 2021 compared to $4.0 billion at December 31, 2020. This increase can be attributed to our strategy to expand the reach of our banking model which focuses on enhancing the total customer experience including in-store, on-line and mobile banking options. High levels of customer service and convenience across all delivery channels 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 39%, year over year as a result of the successful execution of our strategy. The increase in demand deposits over the last twelve months is also a result of our participation in the PPP loan program. Many of the PPP loans originated were for small businesses that were previously not customers of Republic Bank. Many of these small businesses have chosen to move their primary banking relationship to Republic as a result of the outstanding level of service and cooperation they experienced during the PPP loan process. Commercial deposits were 44% of total deposits as of December 31, 2021.

 

6

 

Lending

 

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

 

Description

 

12/31/21

   

12/31/20

   

%

Growth

   

09/30/21

   

%

Growth

 
                                         

Commercial and industrial

  $ 252,376     $ 200,188       26 %   $ 250,650       1 %

Owner occupied real estate

    526,570       475,206       11 %     496,301       6 %

Commercial real estate

    780,311       705,748       11 %     775,168       1 %

Construction and land development

    216,008       142,821       51 %     153,132       41 %

Residential mortgage

    536,332       395,174       36 %     496,963       8 %

Consumer and other

    81,001       102,019       21 %     85,680       (5 %)

Sub-total (excl PPP Loans)

    2,392,598       2,021,156       18 %     2,257,894       6 %

Paycheck protection program

    114,767       624,186       (82 %)     239,120       (52 %)

Total Loans

  $ 2,507,365     $ 2,645,342       (5 %)   $ 2,497,014       - %

 

Total loans decreased by $138 million, or 5%, at December 31, 2021 when compared to December 31, 2020. Loans originated through the PPP loan program continue to be repaid or forgiven by the SBA which offsets the growth experienced in other categories in the portfolio. Excluding the impact of the PPP loans, gross loans increased by $371 million, or 18%, to $2.4 billion at December 31, 2021 compared to $2.0 billion at December 31, 2020. We continue to see results from the continued success with our relationship banking model which has driven a steady flow in quality loan demand. We experienced strongest growth in the commercial and industrial, owner-occupied real estate, commercial real estate and residential mortgage categories over the last twelve months.

 

7

 

 

Asset Quality

 

The Company’s asset quality ratios are highlighted below:

 

   

Three Months Ended

 
                   
   

12/31/21

   

09/30/21

   

12/31/20

 
                         

Non-performing assets / capital and reserves

    3.86 %     3.96 %     4.37 %

Non-performing assets / total assets

    0.24 %     0.25 %     0.28 %

Quarterly net loan charge-offs / average loans*

    0.02 %     0.00 %     0.05 %

Allowance for loan losses / gross loans*

    0.79 %     0.77 %     0.64 %

Allowance for loan losses / non-performing loans

    147 %     133 %     101 %

 

*Note: PPP loans excluded when calculating % of total loan balances. See disclosure related to non-GAAP financial measures at the end of this release.

 

The percentage of non-performing assets to total assets decreased to 0.24% at December 31, 2021, compared to 0.28% at December 31, 2020. The allowance for loan losses as a percentage of total loans excluding PPP loans increased to 0.79% as of December 31, 2021 compared to 0.64% as of December 31, 2020. The allowance for loan losses as a percentage of non-performing loans increased to 147% at December 31, 2021 compared to 101% at December 31, 2020 as a result of the increase in the allowance for loan losses over the last 12 months.

 

Capital

 

The Company’s capital ratios at December 31, 2021 were as follows:

 

   

Actual

12/31/21

Bancorp

   

Actual

12/31/21

Bank

   

Regulatory

Guidelines

“Well Capitalized

 
                         

Leverage Ratio

    6.06 %     5.85 %     5.00 %

Common Equity Ratio

    9.20 %     10.78 %     6.50 %

Tier 1 Risk Based Capital

    11.14 %     10.78 %     8.00 %

Total Risk Based Capital

    11.76 %     11.40 %     10.00 %

Tangible Common Equity

    4.89 %     5.74 %     n/a  

Tangible Common Equity

(assuming conversion)*

    5.75 %     5.74 %     n/a  

 

*Note: Assumes conversion of all outstanding shares of convertible preferred stock

 

8

 

Total shareholders’ equity increased to $323 million at December 31, 2021 compared to $308 million at December 31, 2020. The increase was primarily due to growth in retained earnings driven by net income over the last twelve months. Book value per common share increased to $4.67 at December 31, 2021 compared to $4.41 per share at December 31, 2020.

 

Non-GAAP Financial Measures

 

In addition to evaluating the Company’s financial results of operations in accordance with accounting principles generally accepted in the U.S. (“GAAP”), management periodically supplements its evaluation with an analysis of certain non-GAAP financial measures that are intended to provide the reader with additional perspectives on operating results, financial conditions, and performance trends, while facilitating comparisons with the performance of other financial institutions. Non-GAAP financial measures are not a substitute for GAAP measures, rather, they should be read and used in conjunction with the Company’s GAAP financial information.

 

The Company believes that disclosing non-GAAP financial measures is both useful internally and is expected by our investors and analysts in order to better understand the overall performance of the Company. Other companies may calculate and define their non-GAAP financial measures and supplemental data differently.

 

 

Analyst and Investor Call

 

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

 

   
 Date: January 20, 2022
 Time: 11:00am (EST)
 From the U.S. dial: (888) 517-2513 [US Toll Free] or
  (847) 619-6533 [US Toll]
 Participant Pin: 6393 951#
   
 An operator will assist you in joining the call.
   

 

 

About Republic First Bancorp, Inc.

 

Republic First Bancorp, Inc. is the holding company for Republic First Bank which does business under the name Republic Bank. Republic Bank 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-two 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.

 

9

 

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, 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

 

10

 

Republic First Bancorp, Inc.

                       

Consolidated Balance Sheets

                       

(Unaudited)

                       
                         
   

December 30,

   

September 30,

   

December 30,

 

(dollars in thousands, except per share amounts)

 

2021

   

2021

   

2020

 
                         

ASSETS

                       

Cash and due from banks

  $ 14,072     $ 15,560     $ 29,746  

Interest-bearing deposits and federal funds sold

    104,812       368,408       745,554  

Total cash and cash equivalents

    118,884       383,968       775,300  
                         

Securities - Available for sale

    1,084,539       889,725       537,547  

Securities - Held to maturity

    1,660,292       1,377,253       814,936  

Restricted stock

    3,510       3,510       3,039  

Total investment securities

    2,748,341       2,270,488       1,355,522  
                         

Loans held for sale

    13,762       16,991       53,370  
                         

Loans receivable

    2,507,365       2,497,014       2,645,342  

Allowance for loan losses

    (18,964 )     (17,218 )     (12,975 )

Net loans

    2,488,401       2,479,796       2,632,367  
                         

Premises and equipment

    127,440       125,301       123,170  

Other real estate owned

    360       532       1,188  

Other assets

    129,412       128,502       124,818  
                         

Total Assets

  $ 5,626,600     $ 5,405,578     $ 5,065,735  
                         
                         
                         

LIABILITIES

                       

Non-interest bearing deposits

  $ 1,404,360     $ 1,346,353     $ 1,006,876  

Interest bearing deposits

    3,786,820       3,625,728       3,006,875  

Total deposits

    5,191,180       4,972,081       4,013,751  
                         

Short-term borrowings

    -       -       633,866  

Subordinated debt

    11,277       11,276       11,271  

Other liabilities

    100,776       98,708       98,734  
                         

Total Liabilities

    5,303,233       5,082,065       4,757,622  
                         

SHAREHOLDERS' EQUITY

                       

Preferred stock

    20       20       20  

Common stock

    594       594       594  

Additional paid-in capital

    324,619       324,023       322,321  

Retained earnings (accumulated deficit)

    12,716       8,388       (8,084 )

Treasury stock at cost

    (3,725 )     (3,725 )     (3,726 )

Stock held by deferred compensation plan

    (183 )     (183 )     (183 )

Accumulated other comprehensive loss

    (10,674 )     (5,604 )     (2,829 )
                         

Total Shareholders' Equity

    323,367       323,513       308,113  
                         
                         

Total Liabilities and Shareholders' Equity

  $ 5,626,600     $ 5,405,578     $ 5,065,735  

 

 

11

 

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)

 

2021

   

2021

   

2020

   

2021

   

2020

 
                                         

INTEREST INCOME

                                       

Interest and fees on loans

  $ 29,151     $ 27,380     $ 25,698     $ 114,894     $ 93,292  

Interest and dividends on investment securities

    10,941       8,217       5,473       32,456       21,144  

Interest on other interest earning assets

    159       181       76       452       514  

Total interest income

    40,251       35,778       31,247       147,802       114,950  
                                         

INTEREST EXPENSE

                                       

Interest on deposits

    4,499       4,283       5,453       18,338       22,751  

Interest on borrowed funds

    51       53       74       252       367  

Total interest expense

    4,550       4,336       5,527       18,590       23,118  
                                         

Net interest income

    35,701       31,442       25,720       129,212       91,832  

Provision for loan losses

    1,850       900       1,400       5,750       4,200  
                                         

Net interest income after provision for loan losses

    33,851       30,542       24,320       123,462       87,632  
                                         

NON-INTEREST INCOME

                                       

Service fees on deposit accounts

    3,163       3,283       2,336       12,905       10,236  

Mortgage banking income

    2,145       2,397       7,113       12,016       17,588  

Gain on sale of SBA loans

    1,178       641       174       3,214       1,741  

Gain on sale of investment securities

    -       -       -       2       2,760  

Other non-interest income

    985       996       1,613       4,607       3,910  

Total non-interest income

    7,471       7,317       11,236       32,744       36,235  
                                         

NON-INTEREST EXPENSE

                                       

Salaries and employee benefits

    15,039       14,640       15,123       59,253       56,277  

Occupancy and equipment

    5,915       5,689       5,834       23,521       22,210  

Legal and professional fees

    2,310       1,065       1,344       5,447       4,222  

Foreclosed real estate

    134       119       21       844       459  

Regulatory assessments and related fees

    968       904       618       3,478       2,549  

Goodwill impairment

    -       -       -       -       5,011  

Other operating expenses

    8,500       7,358       6,967       29,961       26,695  

Total non-interest expense

    32,866       29,775       29,907       122,504       117,423  
                                         

Income before provision for income taxes

    8,456       8,084       5,649       33,702       6,444  
                                         

Provision for income taxes

    2,379       1,988       1,548       8,526       1,390  
                                         

Net income

    6,077       6,096       4,101       25,176       5,054  
                                         

Preferred stock dividends

    875       875       924       3,500       923  
                                         

Net income attributable to common shareholders

  $ 5,202     $ 5,221     $ 3,177     $ 21,676     $ 4,131  
                                         

Net Income per Common Share

                                       

Basic

  $ 0.09     $ 0.09     $ 0.05     $ 0.37     $ 0.07  

Diluted

  $ 0.08     $ 0.08     $ 0.05     $ 0.33     $ 0.07  
                                         

Average Common Shares Outstanding

                                       

Basic

    58,928       58,895       58,859       58,891       58,853  

Diluted

    75,828       75,876       58,917       75,952       58,904  

 

12

 

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, 2021

   

September 30, 2021

   

December 31, 2020

 
                                                                         
           

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

  $ 411,251     $ 159       0.15 %   $ 480,166     $ 181       0.15 %   $ 302,990     $ 76       0.10 %

Investment securities

    2,482,134       10,941       1.75 %     1,948,532       8,240       1.68 %     1,247,502       5,481       1.74 %

Loans receivable

    2,482,173       29,151       4.66 %     2,495,611       27,493       4.37 %     2,668,570       25,821       3.84 %

Total interest-earning assets

    5,375,558       40,251       2.97 %     4,924,309       35,914       2.89 %     4,219,062       31,378       2.95 %
                                                                         

Other assets

    235,955                       248,095                       267,110                  
                                                                         

Total assets

  $ 5,611,513                     $ 5,172,404                     $ 4,486,172                  
                                                                         

Interest-bearing liabilities:

                                                                       
                                                                         

Demand non interest-bearing

  $ 1,401,380                     $ 1,301,102                     $ 1,031,846                  

Demand interest-bearing

    2,263,840       3,402       0.60 %     2,022,477       3,165       0.62 %     1,758,942       3,312       0.75 %

Money market & savings

    1,313,580       832       0.25 %     1,219,009       837       0.27 %     1,071,747       1,420       0.53 %

Time deposits

    197,923       266       0.53 %     193,816       281       0.58 %     194,096       721       1.47 %

Total deposits

    5,176,723       4,500       0.34 %     4,736,404       4,283       0.36 %     4,056,631       5,453       0.53 %
                                                                         

Total interest-bearing deposits

    3,775,343       4,500       0.47 %     3,435,302       4,283       0.49 %     3,024,785       5,453       0.72 %
                                                                         

Other borrowings

    11,277       52       1.83 %     11,276       53       1.86 %     31,847       74       0.92 %
                                                                         
                                                                         

Total interest-bearing liabilities

    3,786,620       4,552       0.48 %     3,446,578       4,336       0.50 %     3,056,632       5,527       0.72 %

Total deposits and other borrowings

    5,188,000       4,552       0.35 %     4,747,680       4,336       0.36 %     4,088,478       5,527       0.54 %
                                                                         
                                                                         

Non interest-bearing liabilities

    100,166                       100,773                       91,873                  

Shareholders' equity

    323,347                       323,951                       305,821                  

Total liabilities and shareholders' equity

  $ 5,611,513                     $ 5,172,404                     $ 4,486,172                  
                                                                         

Net interest income

          $ 35,699                     $ 31,578                     $ 25,851          

Net interest spread

                    2.49 %                     2.39 %                     2.23 %
                                                                         

Net interest margin

                    2.63 %                     2.57 %                     2.43 %

 

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

 

13

 

 

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, 2021

   

December 31, 2020

 
                                                 
           

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

  $ 352,417     $ 453       0.13 %   $ 242,132     $ 514       0.21 %

Securities

    1,890,629       32,456       1.72 %     1,086,386       21,166       1.95 %

Loans receivable

    2,577,498       114,894       4.46 %     2,359,169       93,854       3.98 %

Total interest-earning assets

    4,820,544       147,803       3.07 %     3,687,687       115,534       3.13 %
                                                 

Other assets

    255,721                       265,893                  
                                                 

Total assets

  $ 5,076,265                     $ 3,953,580                  
                                                 

Interest-bearing liabilities:

                                               
                                                 

Demand non interest-bearing

  $ 1,256,043                     $ 926,692                  

Demand interest-bearing

    2,025,420       13,107       0.65 %     1,509,826       12,645       0.84 %

Money market & savings

    1,162,032       3,720       0.32 %     916,607       6,247       0.68 %

Time deposits

    190,960       1,511       0.79 %     211,636       3,859       1.82 %

Total deposits

    4,634,455       18,338       0.40 %     3,564,761       22,751       0.64 %
                                                 

Total interest-bearing deposits

    3,378,412       18,338       0.54 %     2,638,069       22,751       0.86 %
                                                 

Other borrowings

    22,303       253       1.13 %     30,413       367       1.21 %
                                                 
                                                 

Total interest-bearing liabilities

    3,400,715       18,591       0.55 %     2,668,482       23,118       0.87 %

Total deposits and other borrowings

    4,656,758       18,591       0.40 %     3,595,174       23,118       0.64 %
                                                 
                                                 

Non interest-bearing liabilities

    101,473                       87,200                  

Shareholders' equity

    318,034                       271,206                  

Total liabilities and shareholders' equity

  $ 5,076,265                     $ 3,953,580                  
                                                 

Net interest income

          $ 129,212                     $ 92,416          

Net interest spread

                    2.52 %                     2.26 %
                                                 

Net interest margin

                    2.68 %                     2.51 %

 

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

 

14

 

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)

 

2021

   

2021

   

2020

   

2021

   

2020

 
                                         
                                         

Balance at beginning of period

  $ 17,218     $ 16,110     $ 11,851     $ 12,975     $ 9,266  
                                         

Provision charged to operating expense

    1,850       900       1,400       5,750       4,200  
      19,068       17,010       13,251       18,725       13,466  
                                         

Recoveries on loans charged-off:

                                       

Commercial

    275       60       10       510       51  

Consumer

    1       149       3       218       13  

Total recoveries

    276       209       13       728       64  
                                         

Loans charged-off:

                                       

Commercial

    (311 )     1       (249 )     (372 )     (448 )

Consumer

    (69 )     (2 )     (40 )     (117 )     (107 )
                                         

Total charged-off

    (380 )     (1 )     (289 )     (489 )     (555 )
                                         

Net (charge-offs) recoveries

    (104 )     208       (276 )     239       (491 )
                                         

Balance at end of period

  $ 18,964     $ 17,218     $ 12,975     $ 18,964     $ 12,975  
                                         
                                         

Net (charge-offs) recoveries as a percentage of average loans outstanding

    0.02 %     (0.04% )     0.04 %     (0.01% )     0.02 %
                                         

Allowance for loan losses as a percentage of period-end loans

    0.79 %     0.76 %     0.49 %     0.76 %     0.49 %

 

15

 

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)

 

2021

   

2021

   

2021

   

2021

   

2020

 
                                         

Non-accrual loans:

                                       

Commercial real estate

  $ 10,708     $ 10,040     $ 10,069     $ 10,628     $ 10,232  

Consumer and other

    1,833       2,892       1,982       2,562       2,014  

Total non-accrual loans

    12,541       12,932       12,051       13,190       12,246  
                                         

Loans past due 90 days or more and still accruing

    323       13       996       -       612  
                                         

Total non-performing loans

    12,864       12,945       13,047       13,190       12,858  
                                         

Other real estate owned

    360       532       852       1,188       1,188  
                                         

Total non-performing assets

  $ 13,224     $ 13,477     $ 13,899     $ 14,378     $ 14,046  
                                         
                                         

Non-performing loans to total loans

    0.51 %     0.52 %     0.52 %     0.49 %     0.49 %
                                         

Non-performing assets to total assets

    0.24 %     0.25 %     0.26 %     0.27 %     0.28 %
                                         

Non-performing loan coverage

    147.42 %     133.01 %     123.48 %     121.99 %     100.91 %
                                         

Allowance for loan losses as a percentage of total period-end loans

    0.76 %     0.69 %     0.64 %     0.59 %     0.49 %
                                         

Non-performing assets / capital plus allowance for loan losses

    3.86 %     3.96 %     4.13 %     4.44 %     4.37 %

 

16

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Republic First Bancorp Inc provided additional information to their SEC Filing as exhibits

Ticker: FRBK
CIK: 834285
Form Type: 8-K Corporate News
Accession Number: 0001437749-22-001518
Submitted to the SEC: Mon Jan 24 2022 5:36:19 PM EST
Accepted by the SEC: Tue Jan 25 2022
Period: Thursday, January 20, 2022
Industry: State Commercial Banks
Events:
  1. Earnings Release
  2. Financial Exhibit

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