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


 

   
News Release
Republic First Bancorp, Inc.
April 23, 2010



REPUBLIC FIRST BANCORP, INC. REPORTS FIRST QUARTER 2010 FINANCIAL RESULTS

Philadelphia, PA, April 23, 2010 (PR Newswire) – Republic First Bancorp, Inc. (NASDAQ: FRBK), the holding company for Republic First Bank, today announced its financial results for the period ending March 31, 2010.

During the first quarter of 2010, the Company recorded a net loss of $3.9 million, or $0.37 per share, compared to a net loss of $2.4 million, or $0.23 per share, for the fourth quarter 2009.

“Our first quarter was negatively impacted by increases in reserves and charge-offs related to our loan portfolio to strengthen our balance sheet, along with increases in personnel cost required to execute our strategic plan,” said Harry D. Madonna, the Company’s Chairman and Chief Executive Officer.  “We continue to be well capitalized.”

During the first quarter of 2010, the Company announced that the merger agreement with Metro Bank had been terminated due to the uncertainty over regulatory approvals. “While we believe the merger would have accelerated our strategic plan for growth, rebranding and retail banking, we will continue our efforts to focus on positioning our organization to take advantage of the growth opportunities that will arise from the consolidation and disruption of service in the banking industry. With a strong management team in place, we have already made great strides toward the enhancement of retail banking focused relationships. We have renovated most of our existing stores and continue to seek out locations for future sites that will be customer centric to the needs of the Delaware Valley,” said Madonna.


Highlights

Ø  
The first quarter results include a $5.5 million provision for loan losses which reflects reserve building to bolster our balance sheet and accelerate the remix of our loan portfolio.
 
Ø  
Allowance for loan losses to gross loans increased to 2.02%

Ø  
Total loans outstanding decreased by 10% to $665.7 million at March 31, 2010 compared to $741.8 million at March 31, 2009 as a result of the continuing effort to reduce exposure to commercial real estate and strengthen the loan portfolio.

Ø  
The Company continues to reposition its balance sheet and focus on low cost deposit growth.

Ø  
Core deposits increased by $155.5 million, or 29%, during the twelve month period ended March 31, 2010.
 
 

 
 
 

 
Ø  
The cost of funds decreased to 1.38% for the first quarter 2010 compared to 2.09% for the first quarter 2009.

Ø  
Capital levels remain strong with a Total Risk-Based Capital ratio of 12.49% and a Tier I Leverage Ratio of 8.94% at March 31, 2010.

Ø  
With the addition of new talent, products, and services the Company continues to strengthen itself for competitive growth and performance.


Income Statement

The Company reported a net loss of $3.9 million, or $0.37 per share, for the three months ended March 31, 2010, compared to a net loss of $2.4 million, or $0.23 per share in the prior quarter and a net loss of $3.8 million, or $0.35 per share, for the three months ended March 31, 2009. The first quarter 2010 loss was attributable to a provision for loan losses in the amount of $5.5 million.  In addition, the Company recorded expenditures of $1.0 million associated with the termination of the merger agreement with Metro Bancorp, Inc. related to legal fees, underwriting services and other costs.

Net interest income was $7.4 million for the first quarter 2010 compared to $6.9 million for the first quarter 2009. The net interest margin increased to 3.38% for the first quarter 2010 compared to 3.23% for the first quarter of 2009.



Balance Sheet

 
(dollars in thousands)
             
%
       
%
   
3/31/10
   
3/31/09
   
Change
 
12/31/09
   
Change
Total assets
  $ 967,507     $ 911,380       6 %   $ 1,008,642       (4 %)
                                         
Total loans (net)
    665,711       741,822       (10 %)     680,977       (2 %)
                                         
Total deposits
    846,232       779,128       9 %     882,894       (4 %)
                                         
Total core deposits*
    689,996       534,450       29 %     719,319       (4 %)
                                         
* Core deposits equal total deposits less public and brokered certificates of deposit
 
 
The Company’s ongoing effort to remix and strengthen its balance sheet continues to show progress. Net loans decreased to $665.7 million as of March 31, 2010, as the Company continues to reduce concentrations in the commercial real estate portfolio. Core deposits grew by 29% to $690.0 million as of March 31, 2010 compared to $534.5 million at March 31, 2009. Liquidity remained strong as the Company decreased its dependence on outside borrowings, while increasing cash and investment securities balances by $109.6 million as of March 31, 2010 when compared to March 31, 2009. These changes are the direct result of the strong growth in core deposits over that period of time.
 
 
 
2


 

Core Deposits

Core deposits by type of account are as follows:
 
 
(dollars in thousands)
                               
1st Qtr 2010
               
%
       
%
 
Cost of
   
3/31/10
   
3/31/09
   
Change
 
12/31/09
   
Change
 
Funds
Demand noninterest-bearing
  $ 138,842     $ 87,849       58 %   $ 125,618       11 %     0.00 %
Demand interest-bearing
    45,587       38,448       19 %     52,919       -14 %     0.67 %
Money market and savings
    311,792       253,101       23 %     327,103       -5 %     1.38 %
Certificates of deposit
    193,775       155,052       25 %     213,679       -9 %     2.11 %
Total core deposits
  $ 689,996     $ 534,450       29 %   $ 719,319       -4 %     1.29 %
   


Core deposits, which exclude all public and brokered certificates of deposit, increased to $690.0 million at March 31, 2010, an increase of $155.5 million, or 29%, from March 31, 2009 and a decrease of $29.3 million, or 4%, compared to December 31, 2009. We believe core deposits are the appropriate measure of deposits gathered through our store network.

Lending

The following table sets forth the composition of the Company’s loan portfolio at the dates indicated.
 
 
(dollars in thousands)
                                   
         
% of
       
% of
       
% of
   
3/31/10
   
Total
 
3/31/09
   
Total
 
12/31/09
   
Total
                                     
Commercial
  $ 86,326       13 %   $ 93,268       12 %   $ 88,926       13 %
Owner Occupied
    83,500       12 %     71,708       10 %     85,481       12 %
Total Commercial
    169,826       25 %     164,976       22 %     174,407       25 %
                                                 
Consumer & Residential
    21,518       3 %     22,572       3 %     22,359       3 %
Commercial Real Estate
    488,092       72 %     562,708       75 %     497,052       72 %
                                                 
Gross loans
  $ 679,436       100 %   $ 750,256       100 %   $ 693,818       100 %
 

 

3






Asset Quality

The Company’s asset quality ratios are highlighted below:

       
  Quarter Ended
 
3/31/10
 
3/31/09
 
12/31/09
Nonperforming assets / total assets
4.94%
 
3.10%
 
3.93%
Net loan charge-offs / average total loans
2.74%
 
2.51%
 
0.46%
Allowance for loan losses / gross loans
2.02%
 
1.12%
 
1.85%
Allowance for loan losses / non-performing loans
37.37%
 
46.22%
 
49.32%
Nonperforming assets / capital and reserves
60.54%
 
33.28%
 
47.70%
           

Non-performing assets were $47.8 million, or 4.94% of total assets, as of March 31, 2010 compared to $39.6 million, or 3.93%, of total assets at December 31, 2009 and $28.3 million, or 3.10%, of total assets at March 31, 2009. The Company recorded a provision for loan losses of $5.5 million during the three months ended March 31, 2010, compared to a provision of $4.8 million for the quarter ended March 31, 2009. The allowance for loan losses as a percentage of total loans was 2.02% as of March 31, 2010, compared to 1.12% one year ago.


Capital

The Company’s capital regulatory ratios at March 31, 2010 were as follows:
 
 
       
 
Republic First
 
Regulatory Guidelines
 
Bancorp, Inc.
 
"Well Capitalized"
Leverage Ratio
8.94%
   
5.00%
 
Tier I Risk Based Capital
11.21%
   
6.00%
 
Total Risk Based Capital
12.49%
   
10.00%
 
 

Total shareholders’ equity was $65.2 million at March 31, 2010 which represented a book value per share of $6.18, based on common shares outstanding of approximately 10.6 million.
 
 

 
4



About Republic First Bank

Republic First 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 twelve offices located in Abington, Ardmore, Bala Cynwyd, Plymouth Meeting, Media and Philadelphia, Pennsylvania and Voorhees, New Jersey.

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.  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. These factors include competition, timing, credit risks of lending activities, changes in general economic conditions, price pressures on loan and deposit products, and other factors detailed from time to time in the Company’s filings with the Securities and Exchange Commission. 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, except as may be required by applicable law or regulations.



Source:

Republic First Bancorp, Inc.

Contact:

Frank A. Cavallaro, CFO
(215) 735-4422
 
 
5

 
 
Republic First Bancorp, Inc.
                             
Selected Consolidated Financial Data
                             
(Unaudited)
                             
                               
                               
               
Three months ended
       
               
%
         
%
 
(dollars in thousands, except per share amounts)
 
3/31/10
   
12/31/09
   
Change
   
3/31/09
   
Change
 
                               
Income Statement Data:
                             
Net interest income
  $ 7,409     $ 6,960       6 %   $ 6,858       8 %
Provision for loan losses
    5,500       1,000       450 %     4,800       15 %
Non-interest income (loss)
    475       (1,205 )     (139 %)     652       27 %
Total revenues
    7,884       5,755       37 %     7,510       5 %
Non-interest expenses
    8,405       8,555       (2 %)     8,485       (1 %)
Provision (benefit) for income taxes
    (2,159 )     (1,368 )     58 %     (2,015 )     (7 %)
Net income (loss)
    (3,862 )     (2,432 )     59 %     (3,760 )     (3 %)
                                         
Per Common Share Data:
                                       
Net income (loss): Basic
  $ (0.37 )   $ (0.23 )     61 %   $ (0.35 )     (6 %)
Net income (loss): Diluted
    (0.37 )     (0.23 )     61 %     (0.35 )     (6 %)
Book Value
  $ 6.18     $ 6.59             $ 7.19          
Weighted average shares outstanding:
                                       
Basic
    10,578       10,666               10,631          
Diluted
    10,578       10,666               10,631          
                                         
Balance Sheet Data:
                                       
Total assets
  $ 967,507     $ 1,008,642       (4 %)   $ 911,380       6 %
Loans (net)
    665,711       680,977       (2 %)     741,822       (10 %)
Allowance for loan losses
    13,725       12,841       7 %     8,434       63 %
Investment securities
    183,400       192,395       (5 %)     86,444       112 %
Total deposits
    846,232       882,894       (4 %)     779,128       9 %
Core deposits*
    689,996       719,319       (4 %)     534,450       29 %
Public and brokered certificates of deposit
    156,236       163,575       (4 %)     244,678       (36 %)
Other borrowed money
    25,000       25,000       -       25,000       -  
Subordinated debt
    22,476       22,476       -       22,476       -  
Stockholders' equity
    65,182       70,264       (7 %)     76,487       (15 %)
                                         
Capital:
                                       
Stockholders' equity to total assets
    6.74 %     6.97 %             8.39 %        
Leverage ratio
    8.94 %     9.36 %             9.53 %        
Risk based capital ratios:
                                       
Tier 1
    11.21 %     11.89 %             12.35 %        
Total Capital
    12.49 %     13.14 %             13.39 %        
                                         
Performance Ratios:
                                       
Cost of funds
    1.38 %     1.63 %             2.09 %        
Deposit cost of funds
    1.22 %     1.49 %             2.01 %        
Net interest margin
    3.38 %     3.01 %             3.23 %        
Return on average assets
    (1.61 %)     (0.97 %)             (1.66 %)        
Return on average total stockholders' equity
    (22.68 %)     (13.38 %)             (19.41 %)        
                                         
Asset Quality
                                       
Net charge-offs to average loans outstanding
    2.74 %     0.46 %             2.51 %        
Nonperforming assets to total period-end assets
    4.94 %     3.93 %             3.10 %        
Allowance for loan losses to total period-end loans
    2.02 %     1.85 %             1.12 %        
Allowance for loan losses to nonperforming loans
    37.37 %     49.32 %             46.22 %        
Nonperforming assets to capital and reserves
    60.54 %     47.70 %             33.28 %        
                                         
* Core deposits equal total deposits less public and brokered certificates of deposit
                 
 
 
 
 
6

 
 
 
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)
March 31, 2010
 
December 31, 2009
 
March 31, 2009
                                     
       
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
 $    22,840
 
 $           20
 
0.36%
 
 $  101,795
 
 $           68
 
0.27%
 
 $      5,381
 
 $             3
 
0.23%
Securities
 
     190,738
 
         1,716
 
3.60%
 
     127,672
 
         1,298
 
4.07%
 
       90,966
 
         1,190
 
5.23%
Loans receivable
 
     683,846
 
         8,759
 
5.19%
 
     695,391
 
         9,385
 
5.35%
 
     770,562
 
         9,990
 
5.26%
Total interest-earning assets
     897,424
 
       10,495
 
4.74%
 
     924,858
 
       10,751
 
4.61%
 
     866,909
 
       11,183
 
5.23%
                                     
Other assets
 
       73,516
         
       66,143
         
       49,574
       
                                     
Total assets
 
 $  970,940
         
 $  991,001
         
 $  916,483
       
                                     
Interest-bearing liabilities:
                               
                                     
Demand non interest-bearing
 $  125,400
         
 $  101,446
         
 $    77,527
       
Demand interest-bearing
       49,506
 
 $           82
 
0.67%
 
       53,834
 
 $           92
 
0.68%
 
       42,087
 
 $           65
 
0.63%
Money market & savings
     307,862
 
         1,050
 
1.38%
 
     320,613
 
         1,417
 
1.75%
 
     226,663
 
         1,101
 
1.97%
Time deposits
 
     360,796
 
         1,405
 
1.58%
 
     386,616
 
         1,730
 
1.78%
 
     394,742
 
         2,501
 
2.57%
Total deposits
 
     843,564
 
         2,537
 
1.22%
 
     862,509
 
         3,239
 
1.49%
 
     741,019
 
         3,667
 
2.01%
                                     
Total interest-bearing deposits
     718,164
 
         2,537
 
1.43%
 
     761,063
 
         3,239
 
1.69%
 
     663,492
 
         3,667
 
2.24%
                                     
Other borrowings
 
       48,586
 
            489
 
4.08%
 
       47,476
 
            495
 
4.14%
 
       87,726
 
            603
 
2.79%
                                     
                                     
Total interest-bearing liabilities
 $  766,750
 
 $      3,026
 
1.60%
 
 $  808,539
 
 $      3,734
 
1.83%
 
 $  751,218
 
 $      4,270
 
2.31%
Total deposits and
                                   
  other borrowings
 
     892,150
 
         3,026
 
1.38%
 
     909,985
 
         3,734
 
1.63%
 
     828,745
 
         4,270
 
2.09%
                                     
                                     
Non interest-bearing liabilities
         9,716
         
         8,893
         
         9,184
       
Shareholders' equity
 
       69,074
         
       72,123
         
       78,554
       
Total liabilities and
                                   
shareholders' equity
 
 $  970,940
         
 $  991,001
         
 $  916,483
       
                                     
Net interest income
     
 $      7,469
         
 $      7,017
         
 $      6,913
   
Net interest spread
         
3.14%
         
2.78%
         
2.92%
                                     
Net interest margin
         
3.38%
         
3.01%
         
3.23%
                                     
                                     
The above tables are presented on a tax equivalent basis.
                   
 
 
 
7

 
 
Republic First Bancorp, Inc.
                 
Summary of Allowance for Loan Losses and Other Related Data
 
(unaudited)
                 
                   
                   
         
Three months ended
 
(dollars in thousands)
 
3/31/10
   
12/31/09
   
3/31/09
 
                   
Balance at beginning of period
  $ 12,841     $ 12,644     $ 8,409  
Provisions charged to operating expense
    5,500       1,000       4,800  
      18,341       13,644       13,209  
                         
Recoveries on loans charged-off:
                       
  Commercial
    150       -       -  
  Tax refund loans
    -       -       -  
  Consumer
    -       -       -  
Total recoveries
    150       -       -  
                         
Loans charged-off:
                       
  Commercial
    (4,766 )     (803 )     (4,775 )
  Tax refund loans
    -       -       -  
  Consumer
    -       -       -  
                         
Total charged-off
    (4,766 )     (803 )     (4,775 )
                         
Net charge-offs
    (4,616 )     (803 )     (4,775 )
                         
Balance at end of period
  $ 13,725     $ 12,841     $ 8,434  
                         
Net charge-offs as a percentage of
                       
average loans outstanding
    2.74 %     0.46 %     2.51 %
                         
Allowance for loan losses as a percentage of
                 
period-end loans
    2.02 %     1.85 %     1.12 %
 
 
 
 
8

 
 
Republic First Bancorp, Inc.
                             
Summary of Non-Performing Loans and Assets
                         
(unaudited)
                             
                               
   
March 31,
   
December 31,
   
September 30,
   
June 30,
   
March 31,
 
(dollars in thousands)
 
2010
   
2009
   
2009
   
2009
   
2009
 
                               
Non-accrual loans:
                             
  Commercial real estate
  $ 36,144     $ 25,449     $ 17,997     $ 15,262     $ 14,882  
  Consumer and other
    582       585       588       600       607  
Total non-accrual loans
    36,726       26,034       18,585       15,862       15,489  
                                         
Loans past due 90 days or more
                                       
  and still accruing
    -       -       -       -       2,759  
Renegotiated loans
    -       -       -       -       -  
                                         
Total non-performing loans
    36,726       26,034       18,585       15,862       18,248  
                                         
Other real estate owned
    11,044       13,611       10,847       10,016       10,016  
                                         
Total non-performing assets
  $ 47,770     $ 39,645     $ 29,432     $ 25,878     $ 28,264  
                                         
Non-performing loans to total loans
    5.41 %     3.75 %     2.62 %     2.12 %     2.43 %
                                         
Non-performing assets to total assets
    4.94 %     3.93 %     3.09 %     2.76 %     3.10 %
                                         
Non-performing loan coverage
    37.37 %     49.32 %     68.03 %     101.10 %     46.22 %
                                         
Allowance for loan losses as a percentage
                                       
  of total period-end loans
    2.02 %     1.85 %     1.78 %     2.14 %     1.12 %
                                         
Non-performing assets/capital plus
                                       
   allowance for loan losses
    60.54 %     47.70 %     34.45 %     29.63 %     33.28 %
 
 
 
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