Republic First Bancorp Inc.

01/25/2022 | Press release | Distributed by Public on 01/25/2022 05:01

REPUBLIC FIRST BANCORP, INC. REPORTS FOURTH QUARTER FINANCIAL RESULTS YTD NET INCOME INCREASES BY 398% TO $25 MILLION AND DEPOSITS GROW 29% - Form 8-K

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

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.

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.
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%.
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.
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.
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.
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.

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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

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.

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.

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.

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.

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.

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

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

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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.

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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.

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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.

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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
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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