REPUBLIC FIRST BANCORP INC - FORM 8-K - EX-99.1 - EXHIBIT 99.1

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8-K - REPUBLIC FIRST BANCORP, INC. FORM 8-K - REPUBLIC FIRST BANCORP INC	republicfirst8k.htm



	News Release
	Republic First Bancorp, Inc.
	July 28, 2015

REPUBLIC FIRST BANCORP, INC. REPORTS ASSET GROWTH OF 19%

DEPOSITS INCREASE BY 22%

Philadelphia, PA, July 28, 2015 (PR Newswire) – Republic First Bancorp, Inc. (NASDAQ: FRBK), the holding company for Republic Bank, today announced its financial results for the three month period ended June 30, 2015.

	Three Months Ended

($ in millions, except per share data)	06/30/15		06/30/14		% Change

Assets	$	1,272.4	$	1,065.1		19	%
Loans		822.9		718.9		14	%
Deposits		1,129.8		924.7		22	%
Total Revenue	$	11.6	$	10.8		8	%
Net Income		0.5		0.5		(1	%)
Net Income per Share	$	0.014	$	0.015		(7	%)

“Our balance sheet growth continues to be extraordinarily positive, which underscores the strength of our expansion strategy,” said Harry D. Madonna, the Company’s Chairman and Chief Executive Officer. “With the recent openings of our newest stores in Marlton and Berlin, NJ, we continue to find that our strong commitment to outstanding service is resonating with a growing Customer base that desires a personal touch when it comes to banking.”

The Company is in the midst of an aggressive expansion plan referred to as “The Power of Red is Back” with the goal of increasing its store footprint while providing legendary customer service. “We are seeing a tremendous response to the unrivaled convenience and service that each and every one of our stores has to offer,” added Madonna. “As evidenced by the significant increase in total assets, loans and deposits, Republic Bank is poised for continued success in the Philadelphia and South Jersey regions.”

Highlights for the Period Ended June 30, 2015

Republic opened its 16th and 17th stores in Marlton and Berlin, NJ which were received with great acceptance by the many Fans that have come to open new accounts. The Company currently has six additional sites in various stages of construction and development for future store locations.

New stores opened within the last 2 years are currently growing deposits at an average rate of $46 million per year. While the average deposit growth for all stores over the last twelve months was $14 million per store.

Total deposits increased by $205 million, or 22%, to $1.1 billion as of June 30, 2015 compared to $925 million as of June 30, 2014.

Non-interest bearing demand deposits increased by 21% to $242 million as of June 30, 2015 compared to $200 million as of June 30, 2014.

Total assets increased by $207 million, or 19%, to $1.3 billion as of June 30, 2015 compared to $1.1 billion as of June 30, 2014.

Total loans grew $104 million, or 14%, to $823 million as of June 30, 2015 compared to $719 million at June 30, 2014.

SBA lending continued to be a focal point of the Company’s lending strategy. More than $12 million in new SBA loans were originated during the three month period ended June 30, 2015. Our team is currently ranked as the #1 SBA lender in the tri-state market of New Jersey, Pennsylvania and Delaware based on the dollar volume of loan originations.

Shareholders’ equity increased by 2% to $113 million as of June 30, 2015 compared to $111 million as of June 30, 2014.

The Company’s Total Risk-Based Capital ratio was 13.88% and Tier I Leverage Ratio was 10.62% at June 30, 2015.

Tangible book value per share was $3.00 as of June 30, 2015. This amount excludes approximately $0.38 per share attributable to the deferred tax asset valuation allowance.

Income Statement

The major components of the income statement are as follows (dollars in thousands, except per share data):

	Three Months Ended							Six Months Ended
	06/30/15		06/30/14		% Change			06/30/15		06/30/14		% Change

Total Revenue	$	11,631	$	10,773		8	%	$	22,675	$	21,302		6	%
Provision for Loan Losses		-		300		(100	%)		-		300		(100	%)
Non-interest Expenses		11,103		9,957		12	%		21,621		19,772		9	%
Net Income		533		537		(1	%)		1,061		1,292		(18	%)
Net Income per Share	$	0.014	$	0.015		(7	%)	$	0.028	$	0.042		(33	%)

The Company reported net income of $533 thousand, or $0.01 per share, for the three month period ended June 30, 2015, compared to net income of $537 thousand, or $0.02 per share, for the three month period ended June 30, 2014. Net income for the six month period ended June 30, 2015 was $1.1 million, or $0.03 per share, compared to net income of $1.3 million, or $0.04 per share, for the six months ended June 30, 2014.

Net interest income increased by $1.1 million, or 13%, to $9.6 million for the three month period ended June 30, 2015 compared to $8.5 million for the three month period ended June 30, 2014. This increase was driven by strong growth in interest-earning assets over the last twelve months.

Non-interest expenses increased by $1.1 million to $11.1 million during the three month period ended June 30, 2015 compared to $10.0 million during the three months ended June 30, 2014. This increase was primarily driven by higher salaries, employee benefits, occupancy and equipment expenses associated with the addition of new stores related to the Company’s expansion strategy over the last twelve months.

Balance Sheet

The major components of the balance sheet are as follows (dollars in thousands):

Description	06/30/15		06/30/14		% Change			03/31/15		% Change

Total assets	$	1,272,418	$	1,065,134		19	%	$	1,263,983		1	%
Total loans (net)		814,477		706,806		15	%		777,857		5	%
Total deposits		1,129,797		924,684		22	%		1,121,397		1	%
Total core deposits		1,119,809		914,451		22	%		1,111,409		1	%

Total assets increased by $207.3 million, or 19%, as of June 30, 2015 when compared to June 30, 2014. Deposits grew by $205.1 million to $1.1 billion as of June 30, 2015 compared to $924.7 million as of June 30, 2014. The number of deposit accounts has grown by 30% during the past twelve months. The strong growth in assets, loans and deposits has been driven by the Company’s successful execution of its aggressive growth strategy referred to as “The Power of Red is Back.”

Core Deposits

Core deposits by type of account are as follows (dollars in thousands):

Description	06/30/15		06/30/14		% Change			03/31/15		% Change			2nd Qtr 2015 Cost of Funds

Demand noninterest-bearing	$	241,550	$	199,553		21	%	$	237,307		2	%		0.00	%
Demand interest-bearing		327,342		212,710		54	%		310,595		5	%		0.41	%
Money market and savings		488,873		431,612		13	%		498,862		(2	%)		0.41	%
Certificates of deposit		62,044		70,576		(12	%)		64,645		(4	%)		0.79	%
Total core deposits	$	1,119,809	$	914,451		22	%	$	1,111,409		1	%		0.35	%

Core deposits increased to $1.1 billion at June 30, 2015 compared to $914.5 million at June 30, 2014 as the Company moves forward with its expansion strategy to increase the number of brick and mortar stores which drives the gathering of low-cost core deposits. The Company recognized strong growth in demand, money market and savings account balances on a year to year basis.

Lending

Loans by type are as follows (dollars in thousands):

Description	06/30/15			% of Total			06/30/14			% of Total			03/31/15			% of Total

Commercial real estate	$	371,051			45	%	$	353,458			49	%	$	364,397			46	%
Construction and land development		34,947			4	%		31,224			5	%		35,238			5	%
Commercial and industrial		166,912			20	%		127,818			18	%		159,819			20	%
Owner occupied real estate		202,467			25	%		167,130			23	%		188,783			24	%
Consumer and other		47,475			6	%		37,255			5	%		40,468			5	%
Residential mortgage		401			0	%		2,330			0	%		405			0	%
Deferred fees		(378	)					(346	)					(309	)
Gross loans	$	822,875			100	%	$	718,869			100	%	$	788,801			100	%

Gross loans increased by $104.0 million, or 14%, to $822.9 million at June 30, 2015 compared to $718.9 million at June 30, 2014 as a result of an increase in quality loan demand over the last twelve months and continued success with its relationship banking model. The Company experienced strong growth in almost every loan category.

Asset Quality

The Company’s non-performing asset balances and asset quality ratios are highlighted below:

	Three Months Ended
	06/30/15	03/31/15	06/30/14

Non-performing assets / total assets	2.31%	2.28%	2.87%
Quarterly net loan charge-offs / average loans	1.26%	0.31%	0.11%
Allowance for loan losses / gross loans	1.02%	1.39%	1.68%
Allowance for loan losses / non-performing loans	52%	44%	45%
Non-performing assets / capital and reserves	24%	23%	25%

Non-performing assets decreased by $1.2 million to $29.4 million, or 2.31% of total assets, at June 30, 2015, compared to $30.6 million, or 2.87% of total assets, as of June 30, 2014. Loan charge-offs in the second quarter of 2015 were $2.5 million, or 1.26% of average loans outstanding compared to $0.2 million or 0.11% of average loans during the second quarter of 2014. This increase was driven by a charge-off associated with one commercial loan which was transferred to other real estate owned during the second quarter of 2015. A loan loss provision for this loan had been recorded in a prior period.

Capital

The Company’s capital ratios at June 30, 2015 were as follows:

	Actual June 30, 2015	Regulatory Guidelines “Well Capitalized”

Leverage Ratio	10.62%	5.00%
Common Equity Ratio	10.95%	6.50%
Tier 1 Risk Based Capital	13.06%	8.00%
Total Risk Based Capital	13.88%	10.00%
Tangible Common Equity	8.92%	n/a

Total shareholders’ equity increased to $113.4 million at June 30, 2015 compared to $111.4 million at June 30, 2014. Tangible book value per share increased to $3.00 at June 30, 2015 compared to $2.95 per share at June 30, 2014.

About Republic Bank

Republic Bank, a subsidiary of Republic First Bancorp, Inc., 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 seventeen stores located in Abington, Ardmore, Bala Cynwyd, Plymouth Meeting, Media and Philadelphia, Pennsylvania and Haddonfield, Cherry Hill, Voorhees, Glassboro, Marlton and Berlin, New Jersey. Republic Bank stores are open 7 days a week, 361 days a year, with extended lobby and drive-thru hours providing customers with the most convenient hours compared to any bank in its market. The Bank also 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. For more information about Republic Bank, visit www.myrepublicbank.com.

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; 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, 2014 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

Republic First Bancorp, Inc.
Consolidated Balance Sheets
(Unaudited)

	June 30,			March 31,			June 30,
(dollars in thousands, except per share amounts)	2015			2015			2014

ASSETS
Cash and due from banks	$	16,377		$	25,316		$	17,070
Interest-bearing deposits and federal funds sold		64,793			137,212			66,050
Total cash and cash equivalents		81,170			162,528			83,120

Securities - Available for sale		176,142			187,024			219,634
Securities - Held to maturity		119,338			66,742			21
Restricted stock		1,179			1,157			1,725
Total investment securities		296,659			254,923			221,380

Loans held for sale		3,464			4,955			491

Loans receivable		822,875			788,801			718,869
Allowance for loan losses		(8,398	)		(10,944	)		(12,063	)
Net loans		814,477			777,857			706,806

Premises and equipment		40,961			36,573			29,041
Other real estate owned		13,162			3,827			3,637
Other assets		22,525			23,320			20,659

Total Assets	$	1,272,418		$	1,263,983		$	1,065,134



LIABILITIES
Non-interest bearing deposits	$	241,550		$	237,307		$	199,553
Interest bearing deposits		888,247			884,090			725,131
Total deposits		1,129,797			1,121,397			924,684

Subordinated debt		22,476			22,476			22,476
Other liabilities		6,706			6,210			6,551

Total Liabilities		1,158,979			1,150,083			953,711

SHAREHOLDERS' EQUITY
Common stock - $0.01 par value		383			383			383
Additional paid-in capital		152,513			152,352			152,131
Accumulated deficit		(34,205	)		(34,738	)		(36,416	)
Treasury stock at cost		(3,725	)		(3,725	)		(3,099	)
Stock held by deferred compensation plan		(183	)		(183	)		(809	)
Accumulated other comprehensive income (loss)		(1,344	)		(189	)		(767	)

Total Shareholders' Equity		113,439			113,900			111,423


Total Liabilities and Shareholders' Equity	$	1,272,418		$	1,263,983		$	1,065,134

Republic First Bancorp, Inc.
Consolidated Statements of Operations
(Unaudited)

	Three Months Ended									Six Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,
(in thousands, except per share amounts)	2015			2015			2014			2015			2014

INTEREST INCOME
Interest and fees on loans	$	9,270		$	9,077		$	8,310		$	18,347		$	16,633
Interest and dividends on investment securities		1,543			1,607			1,271			3,150			2,591
Interest on other interest earning assets		86			77			50			163			62
Total interest income		10,899			10,761			9,631			21,660			19,286

INTEREST EXPENSE
Interest on deposits		1,012			1,018			870			2,030			1,650
Interest on borrowed funds		278			276			277			554			553
Total interest expense		1,290			1,294			1,147			2,584			2,203

Net interest income		9,609			9,467			8,484			19,076			17,083
Provision for loan losses		-			-			300			-			300

Net interest income after provision for loan losses		9,609			9,467			8,184			19,076			16,783

NON-INTEREST INCOME
Service fees on deposit accounts		398			363			287			761			580
Gain on sale of SBA loans		1,222			578			1,046			1,800			2,200
Gain on sale of investment securities		9			-			458			9			458
Other non-interest income		393			636			498			1,029			981
Total non-interest income		2,022			1,577			2,289			3,599			4,219

NON-INTEREST EXPENSE
Salaries and employee benefits		5,715			5,222			4,828			10,937			9,868
Occupancy and equipment		1,951			1,888			1,598			3,839			3,134
Legal and professional fees		690			564			872			1,254			1,529
Foreclosed real estate		371			377			340			748			686
Regulatory assessments and related fees		301			292			196			593			533
Other operating expenses		2,075			2,175			2,123			4,250			4,022
Total non-interest expense		11,103			10,518			9,957			21,621			19,772

Income before benefit for income taxes		528			526			516			1,054			1,230

Benefit for income taxes		(5	)		(2	)		(21	)		(7	)		(62	)

Net income	$	533		$	528		$	537		$	1,061		$	1,292


Net Income per Common Share
Basic	$	0.01		$	0.01		$	0.02		$	0.03		$	0.04
Diluted	$	0.01		$	0.01		$	0.02		$	0.03		$	0.04

Average Common Shares Outstanding
Basic		37,816			37,816			35,157			37,816			30,590
Diluted		38,049			38,047			35,609			38,048			30,932

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)	June 30, 2015							March 31, 2015							June 30, 2014

			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	$	125,839	$	86		0.27	%	$	130,418	$	77		0.24	%	$	82,915	$	50		0.24	%
Securities		265,268		1,617		2.44	%		254,741		1,674		2.63	%		207,545		1,315		2.53	%
Loans receivable		812,155		9,339		4.61	%		783,379		9,145		4.73	%		706,632		8,356		4.74	%
Total interest-earning assets		1,203,262		11,042		3.68	%		1,168,538		10,896		3.78	%		997,092		9,721		3.91	%

Other assets		67,724							61,974							48,652

Total assets	$	1,270,986						$	1,230,512						$	1,045,744

Interest-bearing liabilities:

Demand non interest-bearing	$	229,468						$	226,708						$	177,363
Demand interest-bearing		333,075		341		0.41	%		295,630		290		0.40	%		232,682		225		0.39	%
Money market & savings		491,644		501		0.41	%		489,779		553		0.46	%		427,589		467		0.44	%
Time deposits		73,497		170		0.93	%		75,485		175		0.94	%		78,259		178		0.91	%
Total deposits		1,127,684		1,012		0.36	%		1,087,602		1,018		0.38	%		915,893		870		0.38	%

Total interest-bearing deposits		898,216		1,012		0.45	%		860,894		1,018		0.48	%		738,530		870		0.47	%

Other borrowings		22,476		278		4.96	%		22,516		276		4.97	%		22,476		277		4.94	%


Total interest-bearing liabilities		920,692		1,290		0.56	%		883,410		1,294		0.59	%		761,006		1,147		0.60	%
Total deposits and
other borrowings		1,150,160		1,290		0.45	%		1,110,118		1,294		0.47	%		938,369		1,147		0.49	%


Non interest-bearing liabilities		7,123							7,094							6,741
Shareholders' equity		113,703							113,300							100,634
Total liabilities and
shareholders' equity	$	1,270,986						$	1,230,512						$	1,045,744

Net interest income			$	9,752						$	9,602						$	8,574
Net interest spread						3.12	%						3.19	%						3.31	%

Net interest margin						3.25	%						3.33	%						3.45	%



Note: The above tables are presented on a tax equivalent basis.

Republic First Bancorp, Inc.
Average Balances and Net Interest Income
(unaudited)



	For the six months ended							For the six months ended
(dollars in thousands)	June 30, 2015							June 30, 2014

			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	$	128,116	$	163		0.26	%	$	50,552	$	62		0.25	%
Securities		260,034		3,291		2.53	%		207,793		2,678		2.58	%
Loans receivable		797,846		18,484		4.67	%		696,805		16,723		4.84	%
Total interest-earning assets		1,185,996		21,938		3.73	%		955,150		19,463		4.11	%

Other assets		64,865							45,818

Total assets	$	1,250,861						$	1,000,968

Interest-bearing liabilities:

Demand non interest-bearing	$	228,096						$	173,552
Demand interest-bearing		314,455		631		0.40	%		223,383		416		0.38	%
Money market & savings		490,717		1,054		0.43	%		414,308		883		0.43	%
Time deposits		74,486		345		0.93	%		77,865		351		0.91	%
Total deposits		1,107,754		2,030		0.37	%		889,108		1,650		0.37	%

Total interest-bearing deposits		879,658		2,030		0.47	%		715,556		1,650		0.47	%

Other borrowings		22,496		554		4.97	%		22,476		553		4.96	%


Total interest-bearing liabilities		902,154		2,584		0.58	%		738,032		2,203		0.60	%
Total deposits and
other borrowings		1,130,250		2,584		0.46	%		911,584		2,203		0.49	%


Non interest-bearing liabilities		7,184							6,838
Shareholders' equity		113,427							82,546
Total liabilities and
shareholders' equity	$	1,250,861						$	1,000,968

Net interest income			$	19,354						$	17,260
Net interest spread						3.15	%						3.51	%

Net interest margin						3.29	%						3.64	%



Note: The above tables are presented on a tax equivalent basis.

Republic First Bancorp, Inc.
Summary of Allowance for Loan Losses and Other Related Data
(unaudited)

										Year
	Three months ended									ended			Six months ended
	June 30,			March 31,			June 30,			Dec 31			June 30,			June 30,
(dollars in thousands)	2015			2015			2014			2014			2015			2014


Balance at beginning of period	$	10,944		$	11,536		$	11,950		$	12,263		$	11,536		$	12,263

Provision charged to operating expense		-			-			300			900			-			300
		10,944			11,536			12,250			13,163			11,536			12,563

Recoveries on loans charged-off:
Commercial		1			54			-			385			55			-
Consumer		1			31			1			-			32			1
Total recoveries		2			85			1			385			87			1

Loans charged-off:
Commercial		(2,548	)		(677	)		(188	)		(2,002	)		(3,225	)		(491	)
Consumer		-			-			-			(10	)		-			(10	)

Total charged-off		(2,548	)		(677	)		(188	)		(2,012	)		(3,225	)		(501	)

Net charge-offs		(2,546	)		(592	)		(187	)		(1,627	)		(3,138	)		(500	)

Balance at end of period	$	8,398		$	10,944		$	12,063		$	11,536		$	8,398		$	12,063


Net charge-offs as a percentage of
average loans outstanding		1.26	%		0.31	%		0.11	%		0.22	%		0.79	%		0.14	%

Allowance for loan losses as a percentage
of period-end loans		1.02	%		1.39	%		1.68	%		1.48	%		1.02	%		1.68	%

Republic First Bancorp, Inc.
Summary of Non-Performing Loans and Assets
(unaudited)

	June 30,			March 31,			December 31,			September 30,			June 30,
(dollars in thousands)	2015			2015			2014			2014			2014

Non-accrual loans:
Commercial real estate	$	15,559		$	19,530		$	21,011		$	22,607		$	23,750
Consumer and other		418			426			429			437			446
Total non-accrual loans		15,977			19,956			21,440			23,044			24,196

Loans past due 90 days or more
and still accruing		256			5,013			-			131			2,722

Total non-performing loans		16,233			24,969			21,440			23,175			26,918

Other real estate owned		13,162			3,827			3,715			3,775			3,637

Total non-performing assets	$	29,395		$	28,796		$	25,155		$	26,950		$	30,555


Non-performing loans to total loans		1.97	%		3.17	%		2.74	%		3.08	%		3.74	%

Non-performing assets to total assets		2.31	%		2.28	%		2.07	%		2.38	%		2.87	%

Non-performing loan coverage		51.73	%		43.83	%		53.81	%		52.71	%		44.81	%

Allowance for loan losses as a percentage
of total period-end loans		1.02	%		1.39	%		1.48	%		1.62	%		1.68	%

Non-performing assets / capital plus
allowance for loan losses		24.13	%		23.07	%		20.23	%		21.77	%		24.74	%

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REPUBLIC FIRST BANCORP INC Reports