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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended December 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _________ to __________
Commission File Number 0-24649
REPUBLIC BANCORP, INC.
(Exact name of registrant as specified in its charter)
Kentucky 61-0862051
- - ------------------------------------- ---------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
601 W. Market Street, Louisville, Kentucky 40202
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (502) 584-3600
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
None None
Securities registered pursuant to Section 12(g) of the Act:
Class A Common Stock
(Title of class)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES [X] NO [ ]
Indicate by check mark if the disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
The aggregate market value of the voting and non-voting common stock held by
non-affiliates of the registrant as of March 29, 1999 was approximately
$84,054,00 (for purposes of this calculation, the market value of the Class B
Common Stock was based on the market value of the Class A Common Stock into
which it is convertible).
The number of shares outstanding of the registrant's Class A Common Stock and
Class B Common Stock as of March 29, 1999 was 14,903,610 and 2,203,659,
respectively.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of Registrant's Annual Report to Shareholders for the year ended
December 31, 1998 are incorporated by reference into Parts I and II.
Portions of Registrant's Proxy Statement for the Annual Meeting of Shareholders
to be held April 21, 1999 are incorporated by reference into Part III.
TABLE OF CONTENTS
PART I
1. Business 3
2. Properties 12
3. Legal Proceedings 13
4. Submission of Matters to a Vote of Security Holders 14
PART II
5. Market for Registrant's Common Equity And Related Security
Holder Matters 14
6. Selected Financial Data 16
7. Management's Discussion and Analysis of Financial Condition
and Results of Operations 16
7A. Quantitative and Qualitative Disclosures about Market Risk 16
8. Financial Statements and Supplementary Data 16
9. Changes in and Disagreements with Accountants On Accounting
and Financial Disclosure 16
PART III
10. Directors and Executive Officers of the Registrant 17
11. Executive Compensation 17
12. Security Ownership of Certain Beneficial Owners and Management 17
13. Certain Relationships and Related Transactions 17
PART IV
14. Exhibits, Financial Statement Schedules and Reports on Form 8-K 19
Signatures 20
CAUTIONARY STATEMENT
This Annual Report on Form 10-K contains and incorporates by reference
statements relating to future results of Republic Bancorp, Inc. ("Republic" or
the "Company") that are considered "forward-looking" within the meaning of the
Private Securities Litigation and Reform Act of 1995. These statements relate
to, among other things, expectations concerning loan demand and growth,
simulated changes in interest rates, the adequacy of the Company's allowance for
loan losses, and the Year 2000 issue. Actual results may differ materially from
those expressed or implied as a result of certain risks and uncertainties,
including, but not limited to, changes in political and economic conditions,
interest rate fluctuations, competitive product and pricing pressures within the
Company's markets, equity and fixed income market fluctuations, personal and
corporate customers' bankruptcies, inflation, acquisitions and integrations of
acquired businesses, technological changes, changes in law, changes in fiscal,
monetary, regulatory and tax policies, monetary fluctuations, success in gaining
regulatory approvals when required as well as other risks and uncertainties
reported from time to time in the filings of the Company with the Securities and
Exchange Commission.
PART I
ITEM 1. BUSINESS.
Republic Bancorp, Inc. ("Republic" or the "Company") is a registered
bank holding company headquartered in Louisville, Kentucky. Republic's principal
subsidiary is Republic Bank & Trust Company, a Kentucky banking corporation (the
"Bank"). Incorporated in Kentucky on January 2, 1974, Republic became a bank
holding company when the Bank became authorized to conduct a commercial
banking business in Kentucky in 1981.
The principal business of Republic is directing, planning and
coordinating the business activities of the Bank. The financial condition and
results of operations of Republic are primarily dependent upon the operations of
the Bank. At December 31, 1998, Republic had total assets of $1.2 billion, total
deposits of $747 million and total stockholders' equity of $104 million. Based
on total assets as of December 31, 1998, Republic ranked as the fourth largest
independent bank holding company in Kentucky. The executive offices of Republic
are located at 601 West Market Street, Louisville, Kentucky 40202, telephone
number (502) 584-3600. The Company's Website address is www.republicbank.com.
GENERAL BUSINESS OVERVIEW
As of March 29, 1999, Republic had a total of 19 banking centers,
including a banking center under construction in Louisville, serving seven
Kentucky communities. Its two primary market areas are located in North Central
and Central Kentucky. The North Central Kentucky market includes Louisville, the
largest city in Kentucky, where Republic is headquartered and has 9 banking
centers. Republic's Central Kentucky market includes ten banking centers in the
following Kentucky cities: Bowling Green (1); Elizabethtown (1); Frankfort (2);
Lexington, the second largest city in Kentucky (4); Owensboro (1); and
Shelbyville (1).
Republic has developed a super community banking network, with most of
its banking centers located either in separate communities or portions of urban
areas that represent distinct communities. Each of Republic's banking centers is
managed by an officer with the authority to make pricing and loan decisions
within Company policies and guidelines. The Bank also has local advisory boards
of directors that enhance Republic's awareness of the particular needs of the
communities served.
Republic continues to seek and evaluate additional expansion
opportunities, either through the establishment of de novo banking centers
and/or through acquisitions of existing institutions in the financial services
industry and ancillary nonbanking businesses. The Company intends to continue to
consider various strategic acquisitions of banks, banking assets or financial
services entities related to banking in those geographical areas that management
believes would complement and increase Republic's existing business lines, or
expansion in new market areas or product lines that management determines would
be in the best interest of the Company and its shareholders.
The Company has historically extended credit and provided general
banking services through its banking center network to individuals,
professionals, and businesses. Over the past several years the Company began to
seek new lines of business to diversify its asset mix and further enhance its
profitability. While each new line of business reflects the Company's efforts to
enrich its asset mix, each of these lines of business is an outgrowth of the
basic community banking concepts that the Company has traditionally engaged. The
Company principally markets its services through the following:
MORTGAGE LENDING. The Company utilizes its banking centers and commissioned
originators to offer a complete line of single family residential
mortgage products. The Company generally retains mortgage loans with
variable rates or adjustable rates with up to 10 year fixed rate terms,
and sells its longer term fixed rate loans into the secondary market.
Once closed, the secondary market loans are sold without recourse
principally to the Federal National Mortgage Association (FNMA), the
Federal Home Loan Mortgage Corporation (FHLMC) and other institutional
investors. Generally, fixed rate loans in process are covered by
forward commitments to these investors that limits Republic's interest
rate risk.
Republic does not retain the servicing on the majority of its loans
sold in the secondary market, a practice dating back to 1995.
Management's decision to retain or release servicing rights is largely
dependent upon market conditions. When administering loans with the
servicing retained by the Company, the responsibility of collecting
principal and interest payments, escrowing for taxes and insurance, and
remitting payments to the secondary market investors remains with
Republic. A fee is received by Republic for performing these standard
servicing functions.
PREFERRED CLIENT SERVICES. Republic has established extensive long standing
relationships with the medical communities in its primary markets.
Special loan and deposit products have been tailored to meet the needs
of physicians and their practices. Republic intends to expand these
services to other business groups.
CONSUMER LENDING. Consumer loans made by the Company include automobile loans,
home improvement and home equity loans, operating lines of credit, and
personal loans (both secured and unsecured). Republic is currently
emphasizing home equity loans in its consumer marketing, in place of
two unsecured consumer loan products which were marketed through the
mail and Republic's banking center network prior to 1997.
COMMERCIAL LENDING. In 1997, the Company established a separate commercial
lending unit as an outgrowth of the Company's historical business of
originating loans for small and medium-sized businesses from its
various locations. Commercial loans are generated at each banking
center through solicitations of potential clients primarily in the
Company's market areas. The Company makes commercial loans to a variety
of industries. The Company intends to expand this business through
focused calling programs, seeking to broaden relationships with
commercial clients with both loan and deposit accounts and cash
management services.
SPECIALIZED LENDING. Republic has pursued specialized lending opportunities to
complement its traditional lending programs. These specialized product
lines include Refunds Now, a program offering tax refund anticipation
services. Republic began offering these services through a joint
venture arrangement with Refunds Now, Inc. In October 1998, the Company
acquired Refunds Now, Inc. as a subsidiary, in a stock merger
transaction accounted for as a pooling of interests. Other specialized
lending services include public sector lending, and the origination of
sub-prime loans, which are immediately sold to finance companies or
other sub-prime loan originators, without recourse and with servicing
released.
OTHER BANKING SERVICES. The Bank also provides, on a limited basis, trust
services and engages in credit life insurance sales, item processing,
and other related financial institution lines of business.
Deposits are also a key component to the Company's banking business,
serving as a source of funding for lending as well as increasing client account
relationships. Borrowings, principally from the Federal Home Loan Bank ("FHLB"),
and repurchase agreements, provide other sources of liquidity. In addition, the
Company's investment securities, together with cash and cash equivalents,
provide an important source of liquidity. The Company uses its investments as
collateral for borrowings and to secure public fund deposits.
Republic's operating revenues are derived primarily from interest
earned from its loan and investment securities portfolios and fee income from
loan and deposit products. For information about Republic's loan loss reserve,
and the allocation of the allowance for loan losses by loan type, see the
discussion under the sub-heading "Asset Quality" included on pages 26 to 28 of
Republic's 1998 Annual Report to Shareholders, which is incorporated herein by
reference.
YEAR 2000 PROJECT
For a discussion of Republic's year 2000 project, see page 32 of the
Company's 1998 Annual Report to Shareholders, which discussion is incorporated
herein by reference.
EMPLOYEES
As of December 31, 1998, the Bank had 489 employees of which 405 were
full-time and 84 part-time. None of the Bank's employees are subject to a
collective bargaining agreement, and neither Republic nor the Bank has ever
experienced a work stoppage.
COMPETITION
The Company actively competes with several local and regional
commercial banks, thrifts, credit unions and mortgage companies for deposits,
loans and other banking related financial services. There is intense competition
in the Bank's markets from other financial institutions as well as other
"non-bank" companies which engage in similar activities. Some of the Company's
competitors are not subject to the same degree of regulatory review and
restrictions which apply to the Bank. In addition, the Company must compete with
much larger financial institutions which have greater financial resources than
the Company and, while predominantly headquartered in other states, aggressively
compete for market share in Kentucky. These competitors attempt to gain market
share through their financial products mix, pricing strategies and banking
center locations. Legislative developments related to interstate branching and
banking in general, by providing large banking institutions easier access to a
broader marketplace, are creating more pressure on smaller financial
institutions to consolidate. The Company also competes with insurance companies,
consumer finance companies, investment banking firms, brokerage houses, mutual
fund managers and investment advisors. Retail establishments compete for loans
by offering credit cards and retail installment contracts for the purchase of
goods and merchandise. It is anticipated that competition from both bank and
"non-bank" entities will continue to remain strong in the near future.
SUPERVISION AND REGULATION
Republic and the Bank are subject to the policies of various regulatory
authorities. In particular, bank holding companies and their subsidiaries are
affected by the credit and monetary policies of the Federal Reserve Board.
Republic and the Bank are subject to numerous federal and state laws and
regulations affecting their business and also must undergo periodic examination
by federal and state financial institution examiners. The earnings of the Bank,
and the earnings of Republic, are affected not only by the laws and regulations
applicable to the banking business, but also by the policies and interpretations
of regulatory authorities.
The supervision and regulation of bank holding companies and their
subsidiaries is intended primarily for the protection of depositors, the deposit
insurance funds of the FDIC and the banking system as a whole, and not for the
protection of the bank holding company shareholders or creditors. The banking
agencies have broad enforcement power over bank holding companies and banks
including the power to impose substantial fines and other penalties for
violations of laws and regulations, to issue cease and desist or removal orders,
to seek injunctions, and publicly disclose such actions; and extensive authority
to police unsafe or unsound practices.
The following description summarizes some of the laws to which the
Company and the Bank are subject. References herein to applicable statutes and
regulations are brief summaries thereof, do not purport to be complete, and are
qualified in their entirety by reference to such statutes and regulations.
THE COMPANY
The Company is a bank holding company registered under the BHCA, and it
is subject to supervision, regulation and examination by the Federal Reserve
Board. The BHCA and other federal laws subject bank holding companies to
particular restrictions on the types of activities in which they may engage, and
to a range of supervisory requirements and activities, including regulatory
enforcement actions for violations of laws and regulations.
ACQUISITIONS BY BANK HOLDING COMPANIES. The BHCA requires every bank
holding company to obtain the prior approval of the Federal Reserve Board before
it may acquire all or substantially all of the assets of any bank, or ownership
or control of any voting shares of any bank, if after such acquisition it would
own or control, directly or indirectly, more than 5% of the voting shares of
such bank. In approving bank acquisitions by bank holding companies, the Federal
Reserve Board is required to consider the financial and managerial resources and
future prospects of the bank holding company and the banks concerned, the
convenience and needs of the communities to be served, and various competitive
factors. Consideration of convenience and needs issues includes the parties'
performance under the Community Reinvestment Act of 1977, as amended. Under the
Community Reinvestment Act, all financial institutions have a continuing and
affirmative obligation consistent with safe and sound operation to help meet the
credit needs of their entire communities, including low-to-moderate income
neighborhoods. By virtue of the Riegle-Neal Interstate Banking and Branching
Efficiency Act of 1994, the geographic location of the bank is no longer a
factor. Under that Act, a well-capitalized and well-managed bank holding company
may acquire a bank located in any state, subject to certain deposit percentage
limitations and aging requirements.
ACTIVITIES "CLOSELY RELATED" TO BANKING. The BHCA prohibits a bank
holding company, with certain limited exceptions, from acquiring direct or
indirect ownership or control of any voting shares of any company which is not a
bank or from engaging in any activities other than those of banking, managing or
controlling banks and certain other subsidiaries, or furnishing services to or
performing services for its subsidiaries. One principal exception to these
prohibitions allows the acquisition of interests in companies whose activities
are found by the Federal Reserve Board, by order or regulation, to be so closely
related to banking or managing or controlling banks, as to be a proper incident
to banking. In approving acquisitions by bank holding companies of companies
engaged in banking-related activities, the Federal Reserve Board considers a
number of factors, and weighs the expected benefits to the public (such as
greater convenience and increased competition or gains in efficiency) against
the risks of possible adverse effects (such as undue concentration of resources,
decreased or unfair competition or conflicts of interest). Despite prior
approval, the Federal Reserve may order a holding company or its subsidiaries to
terminate any activity, or terminate its ownership or control of any subsidiary,
when it has reasonable cause to believe that continuation of such activity
constitutes a serious risk to the financial safety, soundness or stability of
any bank subsidiary of the bank holding company.
SAFE AND SOUND BANKING PRACTICES. Bank holding companies are not
permitted to engage in unsafe and unsound banking practices. The Federal Reserve
Board may prohibit a bank holding company from engaging in an activity if it
believes that the transaction would constitute an unsafe or unsound practice or
would violate any law or regulation. The FDIC and the Kentucky Department of
Financial Institutions have similar authority with respect to the Bank.
SOURCE OF STRENGTH. Under Federal Reserve Board policy, a bank holding
company is expected to act as a source of financial strength to each of its
banking subsidiaries and to commit resources to their support. Such support may
be required at times when, absent this Federal Reserve Board policy, a holding
company may not be inclined to provide it. As noted below, a bank holding
company may also be required to guarantee the capital restoration plan of an
undercapitalized banking subsidiary.
CAPITAL ADEQUACY REQUIREMENTS. The Federal Reserve Board has adopted a
system using risk-based capital guidelines to evaluate the capital adequacy of
bank holding companies. Under the guidelines, specific categories of assets are
assigned different risk weights, based generally on the perceived credit risk of
the asset. These risk weights are multiplied by corresponding asset balances to
determine a "risk-weighted" asset base. The guidelines require a minimum total
risk-based capital ratio of 8.0% (of which at least 4.0% is required to consist
of Tier 1 capital elements). Total capital is the sum of Tier 1 and Tier 2
capital. As of December 31, 1998, the Company's ratio of Tier 1 capital to total
risk-weighted assets was 14.63% and its ratio of total capital to total
risk-weighted assets was 15.68%. See Note 13 to the Consolidated Financial
Statements.
In addition to the risk-based capital guidelines, the Federal Reserve
Board uses a leverage ratio as an additional tool to evaluate the capital
adequacy of bank holding companies. The leverage ratio is a company's Tier 1
capital divided by its average total consolidated assets (less goodwill and
certain other intangible assets). Certain highly-rated bank holding companies
may maintain a minimum leverage ratio of 3.0%, but other bank holding companies
may be required to maintain a leverage ratio of up to 200 basis points above the
regulatory minimum. As of December 31, 1998, the Company's leverage ratio was
9.29%.
The federal banking agencies' risk-based and leverage ratios are
minimum supervisory ratios generally applicable to banking organizations that
meet certain specified criteria, assuming that they have the highest regulatory
rating. Banking organizations not meeting these criteria are expected to operate
with capital positions well above the minimum ratios. The federal bank
regulatory agencies may set capital requirements for a particular banking
organization that are higher than the minimum ratios when circumstances warrant.
Federal Reserve Board guidelines also provide that banking organizations
experiencing internal growth or making acquisitions will be expected to maintain
strong capital positions substantially above the minimum supervisory levels,
without significant reliance on intangible assets.
THE BANK
The Bank is a Kentucky chartered banking corporation, the deposits of
which are insured by the Bank Insurance Fund (BIF) and the Savings Association
Fund (SAIF) of the FDIC. The Bank is not a member of the Federal Reserve System;
the Bank is subject to supervision and regulation by the FDIC and the Kentucky
Department of Financial Institutions. Such supervision and regulation subjects
the Bank to special restrictions, requirements, potential enforcement actions
and periodic examination by the FDIC and the Kentucky Department of Financial
Institutions. Because the Federal Reserve Board regulates the bank holding
company parent of the Bank, the Federal Reserve Board also has supervisory
authority which directly affects the Bank.
BRANCHING. Kentucky law permits a Kentucky chartered bank, with prior
regulatory approval, to establish a branch office in any county in which the
bank's principal office or an existing branch is located. In addition, a
Kentucky chartered bank is permitted to combine with a commonly controlled bank
or thrift regardless of its location in Kentucky, provided both of the
institutions have been in operation for at least five years. The Kentucky
banking statutes also permit a Kentucky bank, with prior regulatory approval, to
engage in an interstate merger transaction, and thereby establish a branch
office outside of Kentucky. In any case, the transaction must also be approved
by the FDIC, which considers a number of factors, including financial history,
capital adequacy, earnings prospects, character of management, needs of the
community and consistency with corporate powers. An out-of-state bank is
permitted to establish branch offices in Kentucky by merging with a Kentucky
bank, provided the Kentucky bank has been in operation for at least 5 years. De
novo branching into Kentucky by an out-of-state bank is not permitted by the
Kentucky banking statutes.
RESTRICTIONS ON AFFILIATE TRANSACTIONS. Transactions between the Bank
and its nonbanking affiliates, including the Company, are subject to Section 23A
of the Federal Reserve Act. In general, Section 23A imposes limits on the amount
of such transactions, and also requires certain levels of collateral for loans
to affiliated parties. It also limits the amount of advances to third parties
which are collateralized by the securities or obligations of the Company or its
subsidiaries.
Affiliate transactions are also subject to Section 23B of the Federal
Reserve Act which generally requires that certain transactions between the Bank
and its affiliates be on terms substantially the same, or at least as favorable
to the Bank, as those prevailing at the time for comparable transactions with or
involving other nonaffiliated persons.
RESTRICTIONS ON DISTRIBUTION OF SUBSIDIARY BANK DIVIDENDS AND ASSETS.
Dividends paid by the Bank have provided a substantial part of the Company's
operating funds, and for the foreseeable future it is anticipated that dividends
paid by the Bank to the Company will continue to be the Company's principal
source of operating funds. Capital adequacy requirements serve to limit the
amount of dividends that may be paid by the Bank. Under federal law, the Bank
cannot pay a dividend if, after paying the dividend, the Bank will be
"undercapitalized." The FDIC may declare a dividend payment to be unsafe and
unsound even though the Bank would continue to meet its capital requirements
after the dividend. Under Kentucky banking law, the dividends the Bank can pay
during any calendar year are generally limited to its profits for that year,
plus its retained net profits for the two preceding years, less any required
transfers to surplus or to fund the retirement of preferred stock of debt,
absent approval of the Commissioner of the Kentucky Department of Financial
Institutions.
Because the Company is a legal entity separate and distinct from its
subsidiaries, its right to participate in the distribution of assets of any
subsidiary upon the subsidiary's liquidation or reorganization will be subject
to the prior claims of the subsidiary's creditors. In the event of a liquidation
or other resolution of an insured depository institution, the claims of
depositors and other general or subordinated creditors are entitled to a
priority of payment over the claims of holders of any obligation of the
institution to its shareholders, including any depository institution holding
company (such as the Company) or any shareholder or creditor thereof.
CAPITAL ADEQUACY REQUIREMENTS. The FDIC has adopted regulations
establishing minimum requirements for the capital adequacy of insured
institutions. The FDIC may establish higher minimum requirements if, for
example, a bank has previously received special attention or has a high
susceptibility to interest rate risk.
The FDIC's risk-based capital guidelines generally require state banks
to have a minimum ratio of Tier 1 capital to total risk-weighted assets of 4%
and a ratio of total capital to total risk-weighted assets of 8%. The capital
categories generally have the same definitions for the Bank as for the Company.
As of December 31, 1998, the Bank's ratio of Tier 1 capital to total
risk-weighted assets was 14.59% and its ratio of total capital to total
risk-weighted assets was 15.63%. See Note 13 to the Consolidated Financial
Statements.
The FDIC's leverage guidelines require state banks to maintain Tier 1
capital of no less than 5% of average total assets, except in the case of
certain highly rated banks for which the requirement is 3% of average total
assets. As of December 31, 1998, the Bank's ratio of Tier 1 capital to average
total assets (leverage ratio) was 9.26%. See Note 14 to the Consolidated
Financial Statements.
CORRECTIVE MEASURES FOR CAPITAL DEFICIENCIES. The federal banking
regulators are required to take "prompt corrective action" with respect to
capital-deficient institutions. Agency regulations define,for each capital
category, the levels at which institutions are "well capitalized," "adequately
capitalized," "undercapitalized," "significantly undercapitalized" and
"critically undercapitalized." Under these regulations, a "well capitalized"
bank has a total risk-based capital ratio of 10% or higher; a Tier 1 risk-based
capital ratio of 6% or higher; a leverage ratio of 5% or higher; and is not
subject to any written agreement, order or directive requiring it to maintain a
specific capital level for any capital measure. An "adequately capitalized" bank
has a total risk-based capital ratio of 8% or higher; a Tier 1 risk-based
capital ratio of 4% or higher; a leverage ratio of 4% or higher (3% or higher if
the bank was rated a CAMEL 1 in its most recent examination report and is not
experiencing significant growth); and does not meet the criteria for a well
capitalized bank. A bank is "undercapitalized" if it fails to meet any one of
the ratios required to be adequately capitalized.
Undercapitalized institutions are required to submit a capital
restoration plan, which must be guaranteed by any holding company of the
institution. In addition, agency regulations contain broad restrictions on
certain activities of undercapitalized institutions including asset growth,
acquisitions, branch establishment, and expansion into new lines of business.
With certain exceptions, an insured depository institution is prohibited from
making capital distributions, including dividends, and is prohibited from paying
management fees to control persons if the institution would be undercapitalized
after any such distribution or payment. A bank's capital classification will
also affect its ability to accept brokered deposits. Under the FDIC regulations,
a bank may not lawfully accept, roll over or renew brokered deposits unless
either it is well capitalized or it is adequately capitalized and receives a
waiver from the FDIC.
As an institution's capital decreases, the FDIC's enforcement powers
become more enhanced. A significantly undercapitalized institution is subject to
mandated capital raising activities, restrictions on interest rates paid and
transactions with affiliates, removal of management, and other restrictions. The
FDIC has only very limited discretion in dealing with a critically
undercapitalized institution and is virtually required to appoint a receiver or
conservator.
Banks with risk-based capital and leverage ratios below the required
minimums may also be subject to certain administrative actions, including the
termination of deposit insurance upon notice and hearing, or a temporary
suspension of insurance without a hearing in the event the institution has no
tangible capital.
DEPOSIT INSURANCE ASSESSMENTS. Currently, the FDIC maintains two funds
for the insurance of deposits of financial institutions - the Bank Insurance
Fund (BIF) for deposits originated by banks and the Savings Association
Insurance Fund (SAIF) for deposits originated by savings associations, including
savings association deposits acquired by banks. The Bank must pay assessments to
the FDIC for federal deposit insurance protection. The FDIC has adopted a risk
based assessment system as required by amendments made to the Federal Deposit
Insurance Act. Under this system, FDIC-insured depository institutions pay
insurance premiums at rates based on their risk classification. Institutions
assigned to higher-risk classifications (that is, institutions that pose a
greater risk of loss to their respective deposit insurance funds) pay
assessments at higher rates than institutions that pose a lower risk. An
institution's risk classification is assigned based on its capital levels and
the level of supervisory concern the institution poses to the regulators. In
addition, the FDIC can impose special assessments in certain instances.
The Deposit Insurance Funds Act of 1996 provided for the recapitaliza-
tion of the SAIF through a one time special assessment in 1996 on SAIF-insured
deposits. After that special assessment, the assessment rate disparity between
BIF and SAIF members was eliminated. The current range of BIF and SAIF
assessments is between 0% and .27% of deposits. Institutions which qualify for
the 0% assessment category such as the Bank do, however, still have to pay the
$1,000 minimum semi-annual assessment required by federal statute.
The Deposit Insurance Funds Act of 1996 also addressed the payment of
the Financing Corporation's ("FICO") bond obligations, requiring both BIF and
SAIF insured institutions to share the cost of the FICO bond through additional
assessments on insured deposits.
Cross-Guarantee Provisions. The Financial Institutions Reform, Recovery
and Enforcement Act of 1989 ("FIRREA") contains a "cross-guarantee" provision
which generally makes commonly controlled insured depository institutions liable
to the FDIC for any losses incurred in connection with the failure of a commonly
controlled depository institution.
Consumer Laws and Regulations. In addition to the laws and regulations
discussed herein, the Bank is also subject to certain consumer laws and
regulations that are designed to protect consumers in transactions with banks.
While the list set forth herein is not exhaustive, these laws and regulations
include the Truth in Lending Act, the Truth in Savings Act, the Electronic Funds
Transfer Act, the Expedited Funds Availability Act, the Equal Credit Opportunity
Act, the Real Estate Settlement Procedures Act, and the Fair Housing Act, among
others. These laws and regulations mandate certain disclosure requirements and
regulate the manner in which financial institutions must deal with clients when
taking deposits or making loans. The Bank must comply with the applicable
provisions of these consumer protection laws and regulations as part of its
ongoing business operation.
LEGISLATIVE INITIATIVES
Various legislation, including proposals to overhaul the bank
regulatory system, expand the powers of banking institutions and bank holding
companies and change the way they are regulated, and to permit affilations
between banking organizations, securities firms and insurance companies, is from
time to time introduced in Congress. Such legislation may change banking
statutes and the operating environment of the Company and the Bank in
substantial and unpredictable ways. Republic cannot determine the ultimate
effect that potential legislation, if enacted, or implementing regulations with
respect thereto, would have upon the financial condition or results of
operations of the Company or its subsidiaries.
STATISTICAL DISCLOSURES
The statistical information required by Item 1 may be found in the
Company's 1998 Annual Report to Shareholders (Exhibit 13 hereto) which, to the
extent indicated, is hereby incorporated herein by reference, as follows:
Page in the Company's
Guide 3 Disclosures 1998 Annual Report to Shareholders
I. Distribution of Assets, Liabilities and Shareholders' Equity:
Interest Rates and Interest Differential
A. Average Balance Sheet 19
B. Net Interest Earnings Analysis 19
C. Rate/Volume Analysis 20
II. Investment Portfolio
A. Book Value of Investment Securities 27
B. Maturities of Investment Securities 27
C. Investment Securities Concentrations 27
III. Loan Portfolio
A. Types of Loans 24
B. Maturities and Sensitivity of
Loans to Changes in Interest Rates 24
C. Risk Elements
1. Nonaccrual, Past Due 90 Days or More,
and Restructured Loans 26
2. Potential Problem Loans 44
3. Foreign Outstandings N/A
4. Loan Concentrations 24
D. Other Interest-Bearing Assets N/A
IV. Summary of Loan Loss Experience
A. Analysis of Allowance for Loan Losses 25
B. Allocation of the Allowance for Loan Losses 26
V. Deposits
A. Average Balances 19
B. Maturities of Large Denomination Certificates of Deposit 44
C. Foreign Deposit Liability Disclosure N/A
VI. Return on Equity and Assets
A. Return on Average Assets 16
B. Return on Average Equity 16
C. Dividend Payout Ratio 16
D. Equity to Assets Ratio 16
VII. Short-Term Borrowings 45
ITEM 2. PROPERTIES
The Company's executive offices, principal support and operational
functions are located at 601 West Market Street in Louisville, Kentucky. All of
Republic's banking centers are located in Kentucky. The location of the 19
banking centers, their respective approximate square footage and their form of
occupancy is described in the following table:
BANKING CENTERS Square Owned (O)/
Footage Leased (L)
LOUISVILLE
3726 Lexington Road, Louisville 4,000 L
601 West Market Street, Louisville 43,000 L
2801 Bardstown Road, Louisville 5,000 L
661 South Hurstbourne Parkway, Louisville 21,000 L
4921 Brownsboro Road, Louisville 2,000 L
5320 Dixie Highway, Louisville 5,000 O
4655 Outer Loop, Louisville 3,000 L
9600 Brownsboro Road, Louisville 1,300 L
3950 Kresge Way, Louisville 400 L
LEXINGTON
651 Perimeter Drive, Lexington 4,000 L
2401 Harrodsburg Road, Lexington 4,000 O
641 East Euclid Avenue, Lexington 3,500 O
3098 Helmsdale Place, Lexington 4,000 O
FRANKFORT
100 Highway 676, Frankfort 4,000 O
1001 Versailles Road, Frankfort 4,000 O
BOWLING GREEN, 1700 Scottsville Road 4,000 O
OWENSBORO, 3500 Frederica Street 5,000 O
ELIZABETHTOWN, 1690 Ring Road 21,000 O
SHELBYVILLE, 1641 Midland Trail 5,000 O
The Louisville locations comprised of West Market Street, Bardstown
Road, 9600 Brownsboro Road and South Hurstbourne Parkway are leased from
Republic's Chairman, Mr. Bernard M. Trager, and partnerships in which Republic's
Chairman (Bernard M. Trager) and Chief Executive Officer (Steven E. Trager) are
partners. See Item 13 of this Report.
ITEM 3. LEGAL PROCEEDINGS
In the ordinary course of operations, Republic and the Bank are
defendants in various legal proceedings. In the opinion of management, there is
no proceeding pending or, to the knowledge of management, threatened in which an
adverse decision could result in a material adverse change in the business or
consolidated financial position of Republic or the Bank.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matters were submitted to a vote of security holders during the
fourth quarter of 1998.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED SECURITY HOLDER
MATTERS
CLASS A COMMON STOCK. The Company's Class A Common Stock is traded on
the Nasdaq National Market under the symbol RBCAA. At February 8, 1999, the
approximate number of record holders of Class A Common Stock holders was 852.
The following table summarizes transactions in Class A Common Stock
since July 22, 1998, the date the Class A Common Stock began trading on Nasdaq.
Prior to that time, there was no established public trading market for the Class
A Common Stock. The trading price information reflects the range of actual
closing sales prices for the Class A Common Stock as reported by Nasdaq.
Quarter Ended High Low
- - ------------------------- -------------- ------------
September 30, 1998 $16.44 $12.63
December 31, 1998 14.13 11.88
CLASS B COMMON STOCK. At February 8, 1999, the approximate number of
record holders of Class B Common Stock was 392. There is no established public
trading market for the Class B Common Stock.
DIVIDENDS. Holders of Class A and Class B Common Stock are entitled to
receive dividends when, as and if declared by Republic's board of directors out
of funds legally available. Under Republic's Articles of Incorporation, if cash
dividends are paid on Class B Common Stock, shares of Class A Common Stock are
entitled to cash dividends equal to 110% of the cash dividend paid per share on
the Class B Common Stock.
During 1997 and 1998, Republic declared and paid the following
quarterly cash dividends per share on its Common Stock:
First Second Third Fourth
Quarter Quarter Quarter Quarter
1998
Class A Common Stock $.0275 $.0275 $.0275 $.0275
Class B Common Stock $.0250 $.0250 $.0250 $.0250
1997
Class A Common Stock $.0275 $.0275 $.0275 $.0275
Class B Common Stock $.0250 $.0250 $.0250 $.0250
Republic currently intends to continue to pay regular quarterly cash
dividends on the Class A and Class B Common Stock, subject to Republic's needs
for funds. However, payment of dividends is also subject to the discretion of
Republic's board of directors and regulatory requirements. In determining
whether to continue such dividend payments and in establishing the amount of any
dividends to be paid, the board of directors will consider Republic's earnings,
capital requirements and financial condition, prospects for future earnings,
federal economic and regulatory policies, general business conditions and other
relevant factors, certain of which are beyond the control of Republic.
The primary source of funds for dividends paid by Republic to its
shareholders is the dividend income received from the Bank. Although management
believes that the Bank will be able to generate sufficient earnings to pay
dividends to Republic in amounts sufficient to continue Republic's current
dividend policy with respect to the Class A and Class B Common Stock, there can
be no assurance that the Bank will be able to generate such earnings or to pay
such dividends in the future. The instruments under which the Trust Preferred
securities of Republic's subsidiary, Republic Capital Trust, are outstanding
prohibit the payment of dividends on the Class A and Class B Common Stock if the
Company elects to defer payments of those securities, as permitted by those
instruments.
Unregistered sales of shares during the fourth quarter. On October 28,
1998, the Company issued 230,000 shares of Class B Common Stock. The shares were
issued to the 2 shareholders of Refunds Now, Inc. in connection with the
Company's acquisition of Refunds Now, Inc. The acquisition was accomplished by
the merger of Refunds Now, Inc. with a subsidiary of the Company. In the merger,
all of the outstanding shares of Refunds Now, Inc. were converted into shares of
Class B Common Stock; by virtue of the merger, Refunds Now, Inc. became a wholly
owned subsidiary of the Company. The Company relied on the exemption from
registration under Section 4(2) of the Securities Act of 1933. The Company
believes each shareholder of Refunds Now, Inc. had such knowledge and experience
in financial and business matters that he was capable of evaluating the merits
and risks of the investment in shares of the Company; each was afforded access
to material information about the Company, represented that he was acquiring the
shares for investment and acknowledged the restrictions on transferability of
the shares; and the certificates representing the shares issued were legended to
provide notice of the restrictions on transferability under applicable
securities laws. The shares of Class B Common Stock are convertible into shares
of Class A Common Stock on a one share-for-one share basis.
During the fourth quarter, the Company also issued 259,000 shares of
Class A Common Stock upon conversion of shares of Class B Common Stock by
existing shareholders of the Company in accordance with the share-for-share
conversion terms of the Class B Common Stock. The exemption from registration
relied upon was Section 3(a)(9) of the Securities Act of 1933.
In December 1998, the Company issued 22,500 shares of Class A Common
Stock and 4,500 shares of Class B Common Stock to Steven Trager upon the
exercise of stock options which had been granted to him as an executive officer
of the Company under a compensatory stock option plan. The exemption from
registration relied on by the Registrant was Section 4(2) of the Securities Act
of 1933. Steven Trager is the President, Chief Executive Officer and a director
of the Company and had access to material information concerning the Company.
ITEM 6. SELECTED FINANCIAL DATA
The information captioned "Selected Consolidated Financial Data"
included on page 16 of the Company's annual report to shareholders for the year
ended December 31, 1998 is incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The Management's Discussion and Analysis of Financial Condition and
Results of Operations included on pages 17 through 32 of the Company's annual
report to shareholders for the year ended December 31, 1998, is incorporated
herein by reference.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The information included under the caption "Asset/Liability Management
and Market Risk" included on pages 30 through 31 of the Company's annual report
to shareholders for the year ended December 31, 1998 is incorporated herein by
reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this item, Report of Independent Public
Accountants and Consolidated Financial Statements and related notes, appears on
pages 33 through 57 of the Company's annual report to shareholders for the year
ended December 31, 1998 and is incorporated herein by reference. The Selected
Quarterly Financial Data appears in Note 24 on page 57 of the Company's annual
report to shareholders.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
The information required by this Item appears under the heading "PROPOSAL
ONE ELECTION OF DIRECTORS" on pages 6 through 9 of the Proxy Statement, dated
March 12, 1998, of Republic Bancorp, Inc. for the 1999 Annual Meeting of
Shareholders to be held April 21, 1999 ("Proxy Statement"), and under the
heading "SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE" on page 17 of
the Proxy Statement, all of which is incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION.
Information under the sub-heading "Directors Compensation" on page 9 of
the Proxy Statement and under the heading "CERTAIN INFORMATION AS TO MANAGEMENT"
on pages 9 to 13 of the Proxy Statement is incorporated herein by reference. In
addition, the information under the heading "COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION" on pages 15 and 16 of the Proxy Statement is
incorporated herein by reference, provided that information in the Proxy
Statement under the heading "COMPENSATION COMMITTEE REPORT" is not incorporated
in this Report and shall not be deemed to be a part of this Report.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
Information required by this item is contained on pages 2 to 6 under
the heading "SHARE OWNERSHIP" of the Proxy Statement and is incorporated herein
by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
LEASING ARRANGEMENTS. Within the Louisville, Kentucky, metropolitan
area, the Bank leases space in three buildings, as well as land owned by Bernard
Trager, Chairman of Republic, and Jean Trager, his wife, and partnerships in
which they own controlling interests, including Jaytee Properties Limited
Partnership ("Jaytee"), a shareholder of Republic. Relatives of Bernard Trager,
including Steven Trager and Scott Trager, directors and executive officers of
Republic, are also partners in Jaytee. See notes to the table under "SHARE
OWNERSHIP" appearing on pages 3 to 6 of the Proxy Statement. The buildings
include Republic Corporate Center, which serves as both the Bank's main office
and administrative headquarters in Louisville, Kentucky, and is owned and leased
by TEECO Properties, which is owned by Bernard Trager, as well as the
Hurstbourne Parkway and Bardstown Road banking centers, which are owned and
leased by Jaytee. The leased land is located on U.S. Highway 22 where Republic
currently has a temporary banking center and is owned and leased by Jaytee.
Altogether, these affiliate leases approximate 69,000 square feet and the Bank
pays approximately $104,000 per month, including $5,000 related to the land
lease, with lease terms expiring through June 30, 2008.
Each of the above transactions were obtained on terms comparable to
those which could have been obtained from an unaffiliated party.
RELATIONSHIPS WITH DIRECTORS. The law firm of Wyatt, Tarrant & Combs
provides legal services to Republic. A. Wallace Grafton, Jr., a director of the
Bank and Republic, was a partner in Wyatt, Tarrant & Combs, until his retirement
in September, 1998. Fees paid by Republic to Wyatt, Tarrant & Combs totaled
$207,000 in 1998.
OTHER TRANSACTIONS. Steven Trager, a director and executive officer,
and Shelley Trager Lerner, the daughter of Bernard Trager, and Jean Trager,
Bernard Trager's wife, are directors of Bankers Insurance Agency, Inc., a title
insurance agency which provides title insurance coverage to clients of Republic.
These services resulted in commissions to Bankers Insurance Agency of
approximately $1,000,000 in 1998. The majority owner of Bankers Insurance Agency
is Shelley Trager Lerner. Minority shareholders in Bankers Insurance Agency
include Steven Trager, Jean Trager, and the grandchildren of Bernard Trager:
Michael Kusman, Andrew Kusman, Brett Kusman, Kevin Trager and Emily Trager.
Steven Trager and Shelley Trager Lerner are children of Bernard Trager.
Prior to July, 1998, the Kentucky banking statutes prohibited a
majority shareholder of a state bank (including a bank holding company and, by
extension, the subsidiary bank itself) from acting as agent for title insurance.
These statutory limitations were removed effective July 15, 1998. After the
removal of the statutory limitations, Republic's Board of Directors reexamined
the appropriateness of the Bank acting as a title insurance agent. The Board
concluded that the Bank should not enter the title insurance business at this
time, but should continue to evaluate the feasibility of entering this business
in the future.
In connection with the formation of an employee stock ownership plan to
promote stock ownership by employees, the Company loaned the ESOP $3,873,000.
The ESOP used these funds to purchase 300,000 shares of Class A Common Stock.
The ESOP purchased 200,000 shares from the Company's Chairman and largest
shareholder, Bernard Trager, for $2,582,000, and 100,000 shares from Bankers
Insurance Agency, Inc., in which members of Bernard Trager's family, including
Steven Trager, are directors and shareholders (see above discussion), for
$1,291,000. The price of these shares was determined by a committee of the ESOP
based on the 30 day average trading price of the Company's shares.
INDEBTEDNESS OF MANAGEMENT. Federal banking laws require that all loans
or extensions of credit by the Bank to its executive officers and directors be
made on substantially the same terms, including interest rate and collateral, as
those prevailing at the time for comparable transactions with the general public
and must not involve more than the normal risk of repayment or present other
unfavorable features. In addition, loans made to Bank directors must be approved
in advance by a majority of the disinterested members of the Board of Directors.
The Bank has made loans to executive officers, holders of ten percent
(10%) or more of the shares of any class of its common stock and affiliates and
directors in the ordinary course of business, on substantially the same terms,
including interest rate and collateral, as those prevailing at the time for
comparable transactions with other persons, which loans do not involve more than
the normal risk of collectibility or present other unfavorable features. As of
December 31, 1998, directors and executive officers of Republic had loans
outstanding of $3.5 million.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
(a)(1) Financial Statements.
The following consolidated financial statements of the registrant and
report of independent public accountants are included in the Annual Report to
Shareholders for the fiscal year ended December 31, 1998, on the pages indicated
and are incorporated herein by reference.
Description Page
- - ------------------------------------------------------------- ----------------
Report of Independent Auditors 33
Consolidated balance sheets - December 31, 1998 and 1997 34
Consolidated statements of income and comprehensive income -
years ended December 31 1998, 1997, and 1996 35
Consolidated statements of changes in stockholders' equity -
years ended December 31, 1998, 1997 and 1996 36-37
Consolidated statements of cash flows -
years ended December 31, 1998, 1997 and 1996 38
Notes to consolidated financial statements 39-57
(a)(2) Financial Statements Schedules:
Schedules are omitted because the information is not applicable.
(a)(3) Exhibits:
The Exhibit Index on page 21 of this report is incorporated herein by
reference. The management contracts and compensatory plans or arrangements
required to be filed as exhibits to this Form 10-K pursuant to Item 14(c) are
noted by asterisk in the Exhibit Index.
(b) Reports on Form 8-K.
No reports on Form 8-K were filed during the fourth quarter of 1998.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Company has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
REPUBLIC BANCORP, INC.
March 31, 1999 By: /s/ Steven E. Trager
------------------------------
Steven E. Trager
President & Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities indicated.
/s/ Bernard M. Trager Chairman of the Board March 31, 1999
- - -------------------------------- & Director
Bernard M. Trager
/s/ Steven E. Trager President, Chief Executive March 31, 1999
- - -------------------------------- Officer & Director
Steven E. Trager
/s/ Scott Trager Vice Chairman & Director March 31, 1999
- - --------------------------------
Scott Trager
/s/ Bill Petter Vice Chairman, Chief March 31, 1999
- - ----------------------------- Operating Officer & Director
Bill Petter
/s/ Mark A. Vogt Chief Financial Officer March 31, 1999
- - ------------------------------ Chief Accounting Officer
Mark A. Vogt
/s/ R. Wayne Stratton Director March 31, 1999
- - ----------------------------
R. Wayne Stratton
/s/ Larry M. Hayes Director March 31, 1999
- - ------------------------------
Larry M. Hayes
/s/ A. Wallace Grafton, Jr. Director March 31, 1999
- - ---------------------------
A. Wallace Grafton, Jr.
/s/ Samuel G. Swope Director March 31, 1999
- - ---------------------------
Samuel G. Swope
/s/ D. Harry Jones Director March 31, 1999
- - ------------------------------
D. Harry Jones
INDEX TO EXHIBITS
No. Description
2.1 Agreement to Purchase Assets and Assume Liabilities dated April 1, 1997
by and between United Commonwealth Bank, FSB and Republic Bank & Trust
Company (Incorporated by reference to Exhibit 2.1 to the Current Report
on Form 8-K of Registrant as of November 7, 1997 (Commission File
Number: 33-77324))
2.2 Purchase and Assumption Agreement dated July 18, 1997 between The
Paducah Bank & Trust Company and Republic Bank & Trust Company
(Incorporated by reference to Exhibit 2.2 to the Current Report on Form
8-K of Registrant as of November 7, 1997 (Commission File Number:
33-77324))
2.3 Purchase and Assumption Agreement dated July 21, 1997 between Peoples
First National Bank & Trust Company and Republic Bank & Trust Company
(Incorporated by reference to Exhibit 2.3 to the Current Report on Form
8-K of Registrant as of November 7, 1997 (Commission File Number:
33-77324))
2.4 Purchase and Assumption Agreement dated September 12, 1997 between
First Federal Savings Bank of Leitchfield and Republic Bank & Trust
Company (Incorporated by reference to Exhibit 2.4 to the Current Report
on Form 8-K of Registrant as of November 7, 1997 (Commission File
Number: 33-77324))
3(i) Articles of Incorporation of Registrant, as amended (Incorporated by
reference to Exhibit 3(i) to the Registration Statement on Form S-1 of
Registrant (Registration No. 333-56583))
3(ii) Bylaws of Registrant, as amended (Incorporated by reference to Exhibit
3(ii) to the Registration Statement on Form S-1 of Registrant
(Registration No. 333-56583))
4.1 Provisions of Articles of Incorporation of Registrant defining rights
of security holders (see Articles of Incorporation, as amended, of
Registrant incorporated as Exhibit 3(i) herein)
4.2 Agreement Pursuant to Item 601 (b)(iii) of Regulation S-K (Incorporated
by reference to Exhibit 4.2 of the Annual Report on Form 10-K of
Registrant for the year ended December 31, 1997 (Commission File
Number: 33-77324))
10.1* Officer Compensation Continuation Agreement with Steven E. Trager,
dated January 12, 1995 (Incorporated by reference to Exhibit 10.1 to
Registrant's Annual Report on Form 10-K for the year ended December 31,
1995 (Commission File Number: 33-77324))
10.2* Stock Option Plan Agreement with Steven E. Trager, dated January 12,
1996 (Incorporated by reference to Exhibit 10.2 to Registrant's Annual
Report on Form 10-K for the year ended December 31, 1995 (Commission
File Number: 33-77324))
10.3* Officer Compensation Continuation Agreement with L. Lee Kinsolving,
Jr., dated January 12, 1995 (Incorporated by reference to Exhibit 10.3
to Registrant's Annual Report on Form 10-K for the year ended December
31, 1995 (Commission File Number: 33-77324))
10.4* Stock Option Plan Agreement with L. Lee Kinsolving, Jr. dated
January 12, 1996 (Incorporated by reference to Exhibit 10.4 to
Registrant's Annual Report on Form 10-K for the year ended December 31,
1995 (Commission File Number: 33-77324))
10.5* Officer Compensation Continuation Agreement with A. Scott Trager, dated
January 12, 1995 (Incorporated by reference to Exhibit 10.5 to
Registrant's Annual Report on Form 10-K for the year ended December 31,
1995 (Commission File Number: 33-77324))
10.6* Stock Option Plan Agreement with A. Scott Trager dated January 12, 1996
(Incorporated by reference to Exhibit 10.6 to Registrant's Annual
Report on Form 10-K for the year ended December 31, 1995 (Commission
File Number: 33-77324))
10.7* Officer Compensation Continuation Agreement with E. William Petter,
Jr., dated January 12, 1995 (Incorporated by reference to Exhibit 10.7
to Registrant's Annual Report on Form 10-K for the year ended December
31, 1995 (Commission File Number: 33-77324))
10.8* Stock Option Plan Agreement with E. William Petter, Jr., dated January
12, 1996 (Incorporated by reference to Exhibit 10.8 to Registrant's
Annual Report on Form 10-K for the year ended December 31, 1995
(Commission File Number: 33-77324))
10.9* Death Benefit Agreement with Bernard M. Trager dated September 10, 1996
(Incorporated by reference to Exhibit 10.9 to Registrant's Annual
Report on Form 10-K for the year ended December 31, 1996 (Commission
File Number: 33-77324))
10.10 Lease between Republic Bank & Trust Company and TEECO Properties dated
October 1, 1996, relating to 601 West Market Street, Louisville
(Incorporated by reference to Exhibit 10.10 to the Registration
Statement on Form S-1 of Registrant (Registration No. 333-56583))
10.11 Lease between Republic Bank & Trust Company and Jaytee Properties,
dated August 1, 1982, relating to 2801 Bardstown Road, Louisville
(Incorporated by reference to Exhibit 10.11 of Registrant's Quarterly
Report on Form 10-Q for the quarter ended March 31, 1998 (Commission
File Number: 33-77324))
10.12 Lease between Republic Bank & Trust Company and Jaytee Properties,
dated February 3, 1993, as amended, relating to 661 South Hurstbourne
Parkway, Louisville (Incorporated by reference to Exhibit 10.12 of
Registrant's Quarterly Report on Form 10-Q for the quarter ended March
31, 1998 (Commission File Number:
33-77324))
10.13 Lease between Republic Bank & Trust Company and Jaytee Properties,
dated November 17, 1997, relating to 9600 Brownsboro Road, Louisville
(Incorporated by reference to Exhibit 10.13 of Registrant's Quarterly
Report on Form 10-Q for the quarter ended March 31, 1998 (Commission
File Number: 33-77324))
10.14* Officer Compensation Continuation Agreement with Mark A. Vogt, dated
October 16, 1997 (Incorporated by reference to Exhibit10.14 to the
Registration Statement on Form S-1 of Registrant (Registration No.
333-56583))
10.15* Stock Option Plan Agreement with Mark Vogt, dated April 15, 1996
(Incorporated by reference to Exhibit10.15 to the Registration
Statement on Form S-1 of Registrant (Registration No. 333-56583))
10.16* Summary of Directors Stock Options (Incorporated by reference to
Exhibit 10.16 of Registrant's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1998 (Commission File Number: 000-24649))
11 Statement regarding Computation of Per Share Earnings
13 Excerpts from the 1998 Annual Report to Shareholders incorporated by
reference
21 Subsidiaries of the Registrant
27 Financial Data Schedule
* Denotes management contracts and compensatory plans or arrangements required
to be filed as exhibits to this Form 10-K pursuant to Item 14(c).