EX-99.1 2 ex99-1.htm EXHIBIT 99.1 ex99-1.htm

 
NEWS RELEASE
 
FOR RELEASE IMMEDIATELY
 
Contact:  Paul Frenkiel, CFO
 
(215) 735-4422  ext. 5255


REPUBLIC FIRST BANCORP, INC.
REPORTS THIRD QUARTER EARNINGS

Philadelphia, PA, October 19, 2007 – Republic First Bancorp, Inc. (NASDAQ:FRBK), (the “Company”) the holding company for Republic First Bank (PA), today reported third quarter 2007 earnings of $1.2 million or $.12 per diluted share, compared to $2.4 million or $.23* per diluted share for the same quarter in 2006.  Average loans outstanding increased 13% in third quarter 2007 compared to third quarter 2006.

The $.11 per share reduction in earnings in third quarter 2007 compared to third quarter 2006 primarily reflected the following reductions: $.07 per share due to an increase in the provision for loan losses, $.06 per share from the combination of higher rates on deposits and lower rates on loans due to an increase in non-performing loans, and $.01 in one-time costs related to staff reductions. These factors were partially offset by a favorable $.03 per share from loan growth.

For third quarter 2007, interest income increased $1.7 million to $17.7 million from $16.0 million for third quarter 2006. The increase was due primarily to the increase in average loans outstanding, partially offset by the reduction of interest income from the increase in non-performing loans.

For third quarter 2007, interest expense increased $2.2 million to $9.9 million from $7.7 million for third quarter 2006.  The rate on total interest bearing deposits increased 55 basis points to 4.74% in third quarter 2007 compared to 4.19% for the same period in 2006.

Net interest income for third quarter 2007 of $7.8 million was $523,000 less than the third quarter of 2006 as a result of the above factors. Third quarter net interest margin was 3.30% compared to the 4.03% recorded in the third quarter of 2006. The reduction was due primarily to the 55 basis point increase in the rate on total interest bearing deposits and the increase in non-performing loans from $10.0 million at September 30, 2006 to $25.4 million at September 30, 2007.

The Company has historically resolved problem loans with nominal loss. The $8.8 million increase in non-accruals from June 30, 2007 to September 30, 2007 resulted from loans to a single customer of $13 million which are well secured with real estate and losses are not anticipated.  Since June 30, 2007, the Company has reduced existing non-accrual loans by $4 million without loss.  With the $.07 per share increase in the provision for loan losses, the Company has increased the allowance for loan losses to total loans ratio to 1.04%.  Management believes the loan loss reserve is adequate at current levels based upon charge-off history and monthly analysis of problem loans.

 
 
 
Harry Madonna, Chairman and Chief Executive Officer, stated, “The spike in non performing loans was caused by a default on three loans to related borrowers.  The loans were performing loans for over two years and the reason for the default was an alleged fraud by the borrowers involving unrelated loans from other banks.  The loans in question are well collateralized by ongoing businesses and real estate, including a large waterfront property located on the New Jersey shore.  We do not expect any losses from the loans.  Due to the downturn in the housing market, in an abundance of caution, we have increased our loan loss reserves.  The third quarter numbers also include severance costs of employee reductions to assure that the Bank is operating in an efficient manner.”

Total shareholders’ equity stood at $78.4 million with a book value per share of $7.59 at  September 30, 2007, based on outstanding common shares of approximately 10.3 million.  The Company continues to be well capitalized.

 Republic First Bank (PA) is a full-service, state-chartered commercial bank, whose deposits are insured by the Federal Deposit Insurance Corporation (FDIC).  The Bank provides diversified financial products through its eleven offices located in Abington, Ardmore, Bala Cynwyd, Plymouth Meeting, Media and Philadelphia, Pennsylvania and Voorhees, New Jersey.

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.  These forward-looking statements include statements with respect to the Company's beliefs, plans, objectives, goals, expectations, anticipations, estimates, and intentions that are subject to significant risks and uncertainties and are subject to change based on various factors, many of which are beyond the Company's control. The words “may”, “could”, “should”, “would”, “believe”, “anticipate”, “estimate”, “expect”, “intend”, “plan”, and similar 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 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.

# # #

*  Prior year earnings per share amounts were restated to reflect the 10% stock dividend paid April 17, 2007.



 
 
 

Attachment  #1

 Republic First Bancorp, Inc.              
        
 Condensed Income Statement              
        
 (Dollar amounts in thousands              
        
     except per share data)              
        
 (unaudited)              
        
   
   Three Months Ended
          
   Nine Months Ended
        
   
   September 30
          
   September 30
        
   
2007
    
2006
          
2007
    
2006
        
                                     
 Net Interest Income
   $
7,804
     $
8,327
           $
22,879
     $
25,822
        
 Provision for Loan Losses
    
1,282
      
-
            
1,425
      
1,374
        
 Non-interest Income
    
760
      
874
            
2,155
      
2,833
        
 Non-interest Expenses
    
5,488
      
5,503
            
15,766
      
15,666
        
 Provision for income taxes
    
558
      
1,263
            
2,535
      
3,982
        
 Net Income
   $
1,236
     $
2,435
           $
5,308
     $
7,633
        
                                             
 Diluted EPS
   $
0.12
     $
0.23
    (1)   $
0.50
     $
0.72
    (1)
                                                 
 Republic First Bancorp, Inc.                   
          
 Condensed Balance Sheet                   
          
 (Dollar amounts in thousands)                   
          
 (unaudited)                   
          
                                                 
 Assets
  
September 30,
    
December 31,
            
September 30,
                  
   
2007
    
2006
            
2006
                  
                                                 
 Federal Funds Sold and Other Interest Bearing Cash
   $
65,976
     $
63,673
             $
98,322
                  
 Investment Securities
    
91,291
      
109,176
              
83,237
                  
 Commercial and Other Loans
    
841,774
      
792,060
              
761,803
                  
 Allowance for Loan Losses
     (8,791 )     (8,058 )             (7,934 )                
 Other Assets
    
49,869
      
51,973
              
44,916
                  
                                                 
 Total Assets
   $
1,040,119
     $
1,008,824
             $
980,344
                  
                                                 
 Liabilities and Shareholders' Equity:
                                                
 Transaction Accounts
   $
359,310
     $
385,950
             $
368,121
                  
 Time Deposit Accounts
    
410,579
      
368,823
              
374,870
                  
 FHLB Advances and Trust Preferred Securities
    
179,776
      
165,909
              
151,980
                  
 Other Liabilities
    
12,082
      
13,408
              
13,306
                  
 Shareholders' Equity
    
78,372
      
74,734
              
72,067
                  
 Total Liabilities and Shareholders' Equity
   $
1,040,119
     $
1,008,824
             $
980,344
                  
                                                 
                                                 
(1) Prior year earnings per share has been restated for the 10% stock dividend paid April 17, 2007.
                  

 
 
 

Attachment #2

Republic First Bancorp, Inc.         
  
September 30, 2007         
  
(unaudited)         
  
                     
   
At or For  the  
    
At or For  the 
  
   
Three Months Ended
    
Nine Months Ended
  
   
September 30,
  
September 30,
    
September 30,
  
September 30,
  
Financial Data:
  
2007
  
2006
    
2007
  
2006
  
                     
Return on average assets
  
0.50
%
1.13
%
  
0.73
%
1.24
%
                     
Return on average equity
  
6.29
%
13.66
%
  
9.21
%
15.01
%
                     
Share information:
                    
                     
Book value per share
  
$7.59
  
$7.16
 (1)
  
$7.59
  
$7.16
 (1)
                     
Actual shares outstanding at period end, net of
                
  treasury shares (416,311 and 275,611 shares, respectively)
             10,319,000
  
            10,442,000
 (1)
  
        10,319,000
  
      10,442,000
 (1)
                     
Average diluted shares outstanding
  
             10,598,000
  
            10,724,000
 (1)
  
        10,698,000
  
      10,685,000
 (1)
                     
                     
(1) Prior year share information has been restated for the 10% stock dividend payable April 17, 2007.

 
 
 

Attachment #3        
  
                  
Republic First Bancorp, Inc.       
    
September 30, 2007       
    
(Dollars in thousands)       
    
(unaudited)       
    
            
Credit Quality Ratios:
                  
   
September 30,
    
December 31,
    
September 30,
  
   
2007
    
2006
    
2006
  
                   
Non-accrual and loans accruing,
                  
but past due 90 days or more
   $
25,435
     $
6,916
     $
9,972
  
                         
Restructured loans
    
-
      
-
      
-
  
                         
Total non-performing loans
    
25,435
      
6,916
      
9,972
  
                         
Other real estate owned
    
42
      
572
      
499
  
                         
Total non-performing assets
   $
25,477
     $
7,488
     $
10,471
  
                         
   
Nine Months
    
Twelve Months
    
Nine Months
  
   
Ended
    
Ended
    
Ended
  
   
September 30,
    
December 31,
    
September 30,
  
   
2007
    
2006
    
2006
  
Allowance for Loan Losses
                        
Balance at beginning of period
   $
8,058
     $
7,617
     $
7,617
  
Charge-offs:
                        
  Commercial and construction
    
1,028
      
601
      
445
  
  Tax refund loans
    
-
      
1,286
      
1,286
  
  Consumer
    
2
      
-
      
-
  
    Total charge-offs
    
1,030
      
1,887
      
1,731
  
Recoveries:
                        
  Commercial and construction
    
81
      
37
      
35
  
  Tax refund loans
    
256
      
927
      
639
  
  Consumer
    
1
      
-
      
-
  
    Total recoveries
    
338
      
964
      
674
  
Net charge-offs
    
692
      
923
      
1,057
  
Provision for loan losses
    
1,425
      
1,364
      
1,374
  
Balance at end of period
   $
8,791
     $
8,058
     $
7,934
  
                         
Non-performing loans as
                        
a percentage of total loans
     3.02 %     0.87 %     1.31 %
                         
Nonperforming assets as
                        
a percentage of total assets
     2.45 %     0.74 %     1.07 %
                         
Allowance for loan losses
                        
to total loans
     1.04 %     1.02 %     1.04 %
                         
Allowance for loan losses
                        
to total non-performing loans
     34.56 %     116.51 %     79.56 %

 
 
 

Attachment #4              
        
                                   
Republic First Bancorp, Inc.              
        
September 30, 2007              
        
(Dollars in thousands )              
        
(unaudited)              
        
         
Quarter-to-Date   
              
         
Average Balance Sheet
              
                                     
   
Three months ended   
    
Three months ended   
  
   
September 30, 2007   
    
September 30, 2006   
  
                                     
               
Average
                
Average
  
Interest-Earning Assets:
  
Average
          
Yield/
    
Average
          
Yield/
  
   
Balance
    
Interest
    
Cost
    
Balance
    
Interest
    
Cost
  
                                     
                                     
Commercial and other loans
   $
837,417
     $
16,209
       7.68 %   $
742,420
     $
14,868
       7.95 %
                                                 
Investment securities
    
89,042
      
1,329
      
5.97
      
59,736
      
915
      
6.13
  
                                                 
Federal funds sold
    
10,817
      
139
      
5.10
      
18,524
      
248
      
5.31
  
                                                 
Total interest-earning assets
    
937,276
      
17,677
      
7.48
      
820,680
      
16,031
      
7.75
  
                                                 
Other assets
    
40,513
                      
36,593
                  
                                                 
Total assets
   $
977,789
     $
17,677
             $
857,273
     $
16,031
          
                                                 
Interest-bearing liabilities:
                                                
                                                 
                                                 
Interest-bearing deposits
   $
642,651
     $
7,675
       4.74 %   $
582,072
     $
6,078
       4.19 %
                                                 
Borrowed funds
    
162,268
      
2,198
      
5.37
      
114,227
      
1,626
      
5.65
  
                                                 
                                                 
Interest-bearing liabilities
    
804,919
      
9,873
      
4.87
      
696,299
      
7,704
      
4.39
  
                                                 
Non-interest and
                                                
interest-bearing funding
    
885,565
      
9,873
      
4.42
      
775,241
      
7,704
      
3.94
  
                                                 
                                                 
Other liabilities:
    
14,266
                      
11,309
                  
                                                 
Total liabilities
    
899,831
                      
786,550
                  
                                                 
Shareholders' equity
    
77,958
                      
70,723
                  
                                                 
Total liabilities &
                                                
shareholders' equity
   $
977,789
                     $
857,273
                  
                                                 
Net interest income
           $
7,804
                     $
8,327
          
                                                 
Net interest margin
                     3.30 %                     4.03 %

 
 
 

Attachment #5
                                    
                                     
Republic First Bancorp, Inc.                 
  
September 30, 2007                 
  
(Dollars in thousands )                 
  
(unaudited)                 
  
         
Year-to-Date   
              
         
Average Balance Sheet
              
                                     
   
Nine months ended   
    
Nine months ended   
  
   
September 30, 2007   
    
September 30, 2006   
  
                                     
               
Average
                
Average
  
Interest-Earning Assets:
  
Average
          
Yield/
    
Average
          
Yield/
  
   
Balance
    
Interest
    
Cost
    
Balance
    
Interest
    
Cost
  
                                     
                                     
Commercial and other loans
   $
819,243
     $
47,166
       7.70 %   $
714,695
     $
42,773
       8.00 %
                                                 
Investment securities
    
98,571
      
4,232
      
5.72
      
48,300
      
1,991
      
5.50
  
                                                 
Federal funds sold
    
14,424
      
543
      
5.03
      
25,039
      
900
      
4.81
  
                                                 
Total interest-earning assets
    
932,238
      
51,941
      
7.45
      
788,034
      
45,664
      
7.75
  
                                                 
Other assets
    
39,029
                      
36,940
                  
                                                 
Total assets
   $
971,267
     $
51,941
             $
824,974
     $
45,664
          
                                                 
Interest-bearing liabilities:
                                                
                                                 
                                                 
Interest-bearing deposits
   $
662,307
     $
23,368
       4.72 %   $
576,972
     $
16,281
       3.77 %
                                                 
Borrowed funds
    
139,188
      
5,694
      
5.47
      
86,603
      
3,561
      
5.50
  
                                                 
                                                 
Interest-bearing liabilities
    
801,495
      
29,062
      
4.85
      
663,575
      
19,842
      
4.00
  
                                                 
Non-interest and
                                                
interest-bearing funding
    
879,997
      
29,062
      
4.42
      
746,806
      
19,842
      
3.55
  
                                                 
                                                 
Other liabilities:
    
14,184
                      
10,194
                  
                                                 
Total liabilities
    
894,181
                      
757,000
                  
                                                 
Shareholders' equity
    
77,086
                      
67,974
                  
                                                 
Total liabilities &
                                                
shareholders' equity
   $
971,267
                     $
824,974
                  
                                                 
Net interest income
           $
22,879
                     $
25,822
          
                                                 
Net interest margin
                     3.28 %                     4.38 %