PHILADELPHIA, Dec. 21, 2011 /PRNewswire/ -- Republic First
Bancorp, Inc. (NASDAQ: FRBK), the holding company for Republic
Bank, announced that it has completed the sale of $59.0 million of commercial real estate loans and
foreclosed properties to a single investor. This transaction will
dramatically reduce non-performing asset balances and significantly
improve credit quality metrics while still leaving the Company with
strong capital ratios.
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The loans and foreclosed properties had a book balance of
$45.1 million and included
$28.4 million of non-accrual loans
and other real estate owned. Net proceeds amounted to $30.6 million and the Company expects to incur a
loss of approximately $14.5 million
in the quarter ending December 31,
2011 as a result of the sale. Excluding the completion of
the loan transaction, the Company was projecting an estimated
profit of approximately $1.1 million
for the quarter ending December 31,
2011.
"Strengthening the balance sheet has been a top priority over
the last two years," said Harry D.
Madonna, the Company's Chairman and Chief Executive Officer.
"During that time period we have transformed Republic into a new
bank with a new brand, new management team, renovated store
locations and a retail model focused on fanatical customer
service," said Madonna. "We have strengthened our capital position
and brought stabilization to the balance sheet in an incredibly
challenging economic environment. We believe this transaction
represents the final step in completing the transformation and we
anxiously look forward to building out our model to serve the
customers in our market."
This loan sale significantly improves the Company's asset
quality ratios which are now superior to the average ratios of
comparable financial institutions in its peer group. Some of the
key ratios impacted as a result of the loan sale are as
follows:
|
Actual
Ratio
09/30/11
|
|
Projected
Ratio
12/31/11
|
|
|
|
|
Non-Performing Loans / Total Loans
|
5.05%
|
|
1.95%
|
Non-Performing Assets / Total Assets
|
4.83%
|
|
1.80%
|
Loan Loss
Reserve / Total Loans
|
1.95%
|
|
2.15%
|
Loan Loss
Reserve / Non-Performing Loans
|
38.68%
|
|
110.00%
|
Non-Performing Assets / Capital and
Reserves
|
45.68%
|
|
20.00%
|
Capital levels remain strong after recording the impact of the
loan sale. The Company, along with its banking subsidiary, continue
to meet the criteria necessary to be considered well capitalized as
defined under the regulatory guidelines established by federal
banking agencies. In addition, sufficient capital still
exists for the Company to pursue its growth and expansion
plans.
|
Actual
Ratio
09/30/11
|
|
Projected
Ratio
12/31/11
|
|
|
|
|
Leverage
Ratio
|
10.66%
|
|
8.80%
|
Tier 1
Risk Based Capital Ratio
|
12.72%
|
|
11.60%
|
Total Risk
Based Capital Ratio
|
13.97%
|
|
12.90%
|
|
|
|
|
Book Value
per Common Share
|
$3.40
|
|
$2.90
|
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 thirteen offices located in
Abington, Ardmore, Bala
Cynwyd, Plymouth Meeting,
Media and Philadelphia, Pennsylvania and Voorhees and Haddonfield, New Jersey. For more information
about Republic Bank, visit 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 their impact on capital expenditures; new
service and product offerings by competitors and price pressures;
and similar items. You should carefully review the risk
factors described in the Form 10-K for the year ended December 31, 2010 and other documents the Company
files from time to time with the Securities and Exchange
Commission. The words "may", "believes," "expect," "estimate,"
"project," "anticipate," "should," "intend," "probability," "risk,"
"target," "objective," 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.