Note 9 - Business Combination

9 Months Ended

Sep. 30, 2016

Notes to Financial Statements

Business Combination Disclosure [Text Block]

Note 9: Business Combination

Oak Mortga

ge Company, LLC

On July 26, 2016, Republic entered into an agreement with the owners of Oak Mortgage pursuant to which the Sellers agreed to sell to Republic all of the issued and outstanding limited liability interests of Oak Mortgage. The transaction closed on July 28, 2016, and as a result, Oak Mortgage became a wholly owned subsidiary of Republic on that date. The aggregate cash purchase price paid to the Sellers for their limited liability company interests at closing was $7.1 million, $1.0 million of which was deposited in an escrow account to be disbursed one year from closing subject to adjustment for any covered indemnity claims under the Purchase Agreement. The purchase price is subject to certain post-closing adjustments.

In connection with the Oak Mortgage acquisition, the following table details the consideration paid, the fair value of identifiable assets acquired and liabilities assumed as of the date of the acquisition, and the resulting goodwill recorded (in thousands):

Consideration paid :
Cash	$	7,136
Equity instruments		202
Deferred additional purchase price		500
Value of consideration	$	7,838
Assets acquired :
Cash and cash equivalents	$	1,223
Loans held for sale		20,871
Loans receivable		1,132
Premises and equipment		103
Derivative assets		1,508
Intangible assets – non complete agreements		104
Other assets		125
Total assets		25,066
Liabilities assumed :
Warehouse lines of credit		19,666
Derivative liabilities		412
Other liabilities		2,042
Total liabilities		22,120
Net assets acquired		2,946
Goodwill resulting from acquisition of Oak Mortgage	$	4,892

The following table presents unaudited pro forma information, in thousands, as if the acquisition of Oak Mortgage by the Company had been completed on January 1, 2015. The pro forma information does not necessarily reflect the results of operations that would have occurred had Oak Mortgage been acquired by the Company at the beginning of 2015. The pro forma financial information does not include the impact of possible business model changes, nor does it consider any potential impacts of current market conditions or revenues, expense efficiencies or other factors.

	Nine Months Ended September 30 ,
	201 6		201 5
Total revenues	$	52,610	$	44,238
Net income	$	4,462	$	3,569