Revenues Increased 23% Year-Over-Year
Tangible Book Value Per Share Rose 14%
Year-Over-Year
Dividend Raised for 11th Consecutive Year
First Republic Bank (NYSE: FRC) today announced financial
results for the quarter ended March 31, 2022.
“The entire business continued to perform very well in the first
quarter,” said Mike Roffler, Chief Executive Officer and President.
“Loan originations were our best ever, client satisfaction reached
an all-time high, and we successfully completed our core system
conversion. It was a terrific quarter.”
Quarterly Highlights
Financial Results
– Year-over-year:
– Revenues were $1.4 billion, up 23.0%.
– Net interest income was $1.1 billion, up
22.0%.
– Net income was $401 million, up 19.9%.
– Diluted earnings per share of $2.00, up
11.7%.
– Tangible book value per share was $68.47,
up 14.2%.
– Loan originations totaled $17.8 billion, our best quarter
ever.
– Net interest margin was 2.68%, consistent with the prior
quarter.
– Efficiency ratio was 62.0%, compared to 63.5% for the first
quarter of 2021.
– Increased quarterly dividend to $0.27 per share.
Continued Capital and Credit
Strength
– Tier 1 leverage ratio was 8.70%.
– Nonperforming assets remained at a low 8 basis points of total
assets.
– Credit quality remained strong, with net recoveries of $0.3
million for the quarter.
Continued Business Growth
– Year-over-year:
– Loans totaled $141.3 billion, up 19.7%.
– Deposits were $162.1 billion, up 26.7%.
– Wealth management assets were $274.2
billion, up 25.2%.
– Wealth management revenues were $221
million, up 38.7%.
“Loans and deposits grew nicely during the first quarter, while
credit quality, liquidity and capital all remained very strong,”
said Olga Tsokova, Chief Financial Officer (Acting) and Chief
Accounting Officer. “Total revenues rose 23% and tangible book
value per share was up 14% compared to a year ago. We’re also
pleased to have increased our dividend for the 11th consecutive
year.”
Quarterly Cash Dividend of $0.27 per Share
The Bank announced an increase of $0.05 in its quarterly cash
dividend to $0.27 per share of common stock, our 11th consecutive
year of dividend increases. The first quarter dividend is payable
on May 12, 2022 to shareholders of record as of April 28, 2022.
Strong Asset Quality
Credit quality remains strong. Nonperforming assets were at a
low 8 basis points of total assets at March 31, 2022. The Bank had
net loan recoveries of $0.3 million for the quarter.
During the first quarter, the Bank recorded a provision for
credit losses of $10 million, which was primarily driven by loan
growth.
Continued Book Value Growth
Book value per common share at March 31, 2022 was $69.70, up
13.8% from a year ago. Tangible book value per common share at
March 31, 2022 was $68.47, up 14.2% from a year ago.
Capital Strength
The Bank’s Tier 1 leverage ratio was 8.70% at March 31, 2022,
compared to 8.76% at December 31, 2021.
Since the beginning of 2021, the Bank has raised $2.8 billion in
net additional Tier 1 capital to support our growth.
Continued Business Growth
Loan Originations
Loan originations were $17.8 billion for the quarter, our best
quarter ever. This was up 13.3% from the same quarter a year ago,
primarily due to increases in single family and multifamily
lending.
Single family loan originations were 47% of the total loan
origination volume for the quarter and had a weighted average
loan-to-value ratio of 58%. In addition, multifamily and commercial
real estate loans originated were 13% of total originations, and
had a weighted average loan-to-value ratio of 53%.
Loans totaled $141.3 billion at March 31, 2022, up 19.7%
compared to a year ago. Our loan growth was primarily due to
increases in single family, multifamily, stock secured loans and
capital call lines of credit, partially offset by a decrease in
loans under the Small Business Administration’s Paycheck Protection
Program (“PPP”).
Deposit Growth
Total deposits increased to $162.1 billion, up 26.7% compared to
a year ago, and had an average rate paid of 5 basis points during
the quarter.
At March 31, 2022, checking deposit balances were 70.4% of total
deposits.
Investments
Total investment securities at March 31, 2022 were $30.3
billion, a 17.9% increase compared to year-end and a 39.7% increase
compared to a year ago.
High-quality liquid assets, including eligible cash, totaled
$29.9 billion at March 31, 2022, and represented 16.2% of quarterly
average total assets.
Wealth Management
Total wealth management assets were $274.2 billion at March 31,
2022, down slightly compared to the prior quarter but up 25.2%
compared to a year ago. The modest decline in wealth management
assets for the quarter was due to market depreciation,
significantly offset by net client inflow. The increase in wealth
management assets for the year was due to net client inflow and
market appreciation.
Wealth management revenues totaled $221 million for the quarter,
up 38.7% compared to the first quarter a year ago. Such revenues
represented 15.9% of the Bank’s total revenues for the quarter.
Wealth management assets at March 31, 2022 included investment
management assets of $108.8 billion, brokerage assets and money
market mutual funds of $146.7 billion, and trust and custody assets
of $18.8 billion.
Income Statement and Key Ratios
Revenue Growth
Total revenues were $1.4 billion for the quarter, up 23.0%
compared to the first quarter a year ago.
Net Interest Income Growth
Net interest income was $1.1 billion for the quarter, up 22.0%
compared to the first quarter a year ago. The increase in net
interest income resulted primarily from growth in average
interest-earning assets.
Net Interest Margin
The net interest margin was 2.68% in the first quarter,
consistent with the prior quarter.
Noninterest Income
Noninterest income was $251 million for the quarter, up 28.0%
compared to the first quarter a year ago. The increase was
primarily driven by higher wealth management fees.
Noninterest Expense and Efficiency
Ratio
Noninterest expense was $866 million for the quarter, up 20.2%
compared to the first quarter a year ago, primarily due to
continued investments in our business expansion, including hiring
additional colleagues to support our growth, information systems
initiatives and occupancy costs.
The efficiency ratio was 62.0% for the quarter, compared to
63.5% for the first quarter a year ago.
Income Taxes
The Bank’s effective tax rate for the first quarter of 2022 was
22.9%, compared to 21.9% for the first quarter a year ago.
Conference Call Details
First Republic Bank’s first quarter 2022 earnings conference
call is scheduled for April 13, 2022 at 7:00 a.m. PT / 10:00 a.m.
ET. To access the event by telephone, please dial (888) 256-1007
and provide confirmation code 2134053 approximately 15 minutes
prior to the start time (to allow time for registration).
International callers should dial +1 (856) 344-9299 and provide the
same confirmation code.
The call will also be broadcast live over the Internet and can
be accessed in the Investor Relations section of First Republic’s
website at ir.firstrepublic.com/events-calendar. To listen to the
live webcast, please visit the site at least 15 minutes prior to
the start time to register, download and install any necessary
audio software.
For those unable to join for the live presentation, a replay of
the call will be available beginning April 13, 2022 at 11:00 a.m.
PT / 2:00 p.m. ET through April 20, 2022 at 8:59 p.m. PT / 11:59
p.m. ET. To access the replay, dial (888) 203-1112 and use
confirmation code 2134053#. International callers should dial +1
(719) 457-0820 and enter the same confirmation code. A replay of
the webcast will also be available for 90 days following,
accessible in the Investor Relations section of First Republic
Bank’s website at ir.firstrepublic.com/events-calendar.
The Bank’s press releases are available after release in the
Newsroom and Investor Relations section of First Republic Bank’s
website at firstrepublic.com.
About First Republic Bank
Founded in 1985, First Republic and its subsidiaries offer
private banking, private business banking and private wealth
management. First Republic specializes in delivering exceptional,
relationship-based service and provides a complete line of
products, including residential, commercial and personal loans,
deposit services, and private wealth management, including
investment, brokerage, insurance, trust and foreign exchange
services. Services are offered through preferred banking or wealth
management offices primarily in San Francisco, Palo Alto, Los
Angeles, Santa Barbara, Newport Beach and San Diego, California;
Portland, Oregon; Boston, Massachusetts; Palm Beach, Florida;
Greenwich, Connecticut; New York, New York; and Jackson, Wyoming.
First Republic is a constituent of the S&P 500 Index and KBW
Nasdaq Bank Index. For more information, visit
firstrepublic.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Statements in this press release that are not historical
facts are hereby identified as “forward-looking statements” for the
purpose of the safe harbor provided by Section 21E of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”).
Any statements about our expectations, beliefs, plans, predictions,
forecasts, objectives, assumptions or future events or performance
are not historical facts and may be forward-looking. These
statements are often, but not always, made through the use of words
or phrases such as “anticipates,” “believes,” “can,” “could,”
“may,” “predicts,” “potential,” “should,” “will,” “estimates,”
“plans,” “projects,” “continuing,” “ongoing,” “expects,” “intends”
and similar words or phrases. Accordingly, these statements are
only predictions and involve estimates, known and unknown risks,
assumptions and uncertainties that could cause actual results to
differ materially from those expressed in them.
Forward-looking statements involving such risks and
uncertainties include, but are not limited to, statements
regarding: projections of loans, assets, deposits, liabilities,
revenues, expenses, tax liabilities, net income, capital
expenditures, liquidity, dividends, capital structure, investments
or other financial items; expectations regarding the banking and
wealth management industries; descriptions of plans or objectives
of management for future operations, products or services;
forecasts of future economic conditions generally and in our market
areas in particular, which may affect the ability of borrowers to
repay their loans and the value of real property or other property
held as collateral for such loans; our opportunities for growth and
our plans for expansion (including opening new offices);
expectations about the performance of any new offices; projections
about the amount and the value of intangible assets, as well as
amortization of recorded amounts; future provisions for credit
losses on loans and debt securities, as well as for unfunded loan
commitments; changes in nonperforming assets; expectations
regarding the impact and duration of COVID-19; expectations
regarding our executive transitions; projections about future
levels of loan originations or loan repayments; projections
regarding costs, including the impact on our efficiency ratio; and
descriptions of assumptions underlying or relating to any of the
foregoing.
Factors that could cause actual results to differ from those
discussed in the forward-looking statements include, but are not
limited to: significant competition to attract and retain banking
and wealth management customers, from both traditional and
non-traditional financial services and technology companies; our
ability to recruit and retain key managers, employees and board
members; natural or other disasters, including earthquakes,
wildfires, pandemics or acts of terrorism affecting the markets in
which we operate; the adverse effects of climate change on our
business, clients and counterparties; the negative impacts and
disruptions resulting from COVID-19 on our colleagues and clients,
the communities we serve and the domestic and global economy, which
may have an adverse effect on our business, financial position and
results of operations; interest rate risk and credit risk; our
ability to maintain and follow high underwriting standards;
economic and market conditions, including those affecting the
valuation of our investment securities portfolio and credit losses
on our loans and debt securities; real estate prices generally and
in our markets; our geographic and product concentrations; demand
for our products and services; developments and uncertainty related
to the future use and availability of some reference rates; the
regulatory environment in which we operate, our regulatory
compliance and future regulatory requirements; any future changes
to regulatory capital requirements; legislative and regulatory
actions affecting us and the financial services industry, such as
the Dodd-Frank Wall Street Reform and Consumer Protection Act (the
“Dodd-Frank Act”), including increased compliance costs,
limitations on activities and requirements to hold additional
capital, as well as changes to the Dodd-Frank Act pursuant to the
Economic Growth, Regulatory Relief, and Consumer Protection Act;
our ability to avoid litigation and its associated costs and
liabilities; future Federal Deposit Insurance Corporation (“FDIC”)
special assessments or changes to regular assessments; fraud,
cybersecurity and privacy risks; and custom technology preferences
of our customers and our ability to successfully execute on
initiatives relating to enhancements of our technology
infrastructure, including client-facing systems and applications.
For a discussion of these and other risks and uncertainties, see
First Republic’s FDIC filings, including, but not limited to, the
risk factors in First Republic’s Annual Report on Form 10-K and any
subsequent reports filed by First Republic with the FDIC. These
filings are available in the Investor Relations section of our
website.
All forward-looking statements are necessarily only estimates of
future results, and there can be no assurance that actual results
will not differ materially from expectations, and, therefore, you
are cautioned not to place undue reliance on such statements. Any
forward-looking statements are qualified in their entirety by
reference to the factors discussed throughout our public filings
under the Exchange Act. Further, any forward-looking statement
speaks only as of the date on which it is made, and we undertake no
obligation to update any forward-looking statement to reflect
events or circumstances after the date on which the statement is
made or to reflect the occurrence of unanticipated events.
Non-GAAP Financial Measures
Our management uses and believes that investors benefit from
using certain non-GAAP measures of our financial performance, which
include tangible book value per common share, return on average
tangible common shareholders’ equity, and net interest income on a
fully taxable-equivalent basis. Management believes that tangible
book value per common share and return on average tangible common
shareholders’ equity are useful additional measures to evaluate our
performance and capital position without the impact of goodwill and
other intangible assets and preferred stock. In addition, to
facilitate relevant comparisons of net interest income from taxable
and tax-exempt interest-earning assets, when calculating yields and
net interest margin, we adjust interest income on tax-exempt
securities and tax-advantaged loans so such amounts are fully
equivalent to interest income on taxable sources. We believe that
these non-GAAP financial measures, when taken together with the
corresponding GAAP financial measures, provide meaningful
supplemental information that is not otherwise required by GAAP or
other applicable requirements. These non-GAAP financial measures
should be considered in addition to, not as a substitute for,
financial measures prepared in accordance with GAAP. A
reconciliation of the non-GAAP calculation of the financial measure
to the most comparable GAAP financial measure is presented in
relevant tables in this document.
Explanatory Note
Some amounts presented within this document may not recalculate
due to rounding.
CONSOLIDATED STATEMENTS OF
INCOME
Quarter Ended
March 31,
Quarter Ended
December 31,
(in millions, except per share
amounts)
2022
2021
2021
Interest income:
Loans
$ 1,002
$ 873
$ 992
Investments
180
141
165
Other
2
5
4
Cash and cash equivalents
5
3
6
Total interest income
1,189
1,022
1,167
Interest expense:
Deposits
20
28
20
Borrowings
24
55
27
Total interest expense
44
83
47
Net interest income
1,145
939
1,120
Provision (reversal of provision) for
credit losses
10
(15
)
24
Net interest income after provision
(reversal of provision) for credit losses
1,135
954
1,096
Noninterest income:
Investment management fees
165
119
150
Brokerage and investment fees
22
15
19
Insurance fees
4
3
7
Trust fees
7
6
7
Foreign exchange fee income
23
17
24
Deposit fees
6
6
7
Loan and related fees
9
7
9
Income from investments in life
insurance
14
17
27
Other income, net
1
6
(3
)
Total noninterest income
251
196
247
Noninterest expense:
Salaries and employee benefits
560
463
544
Information systems
107
84
99
Occupancy
69
58
66
Professional fees
23
21
27
Advertising and marketing
13
13
21
FDIC assessments
15
12
13
Other expenses
79
70
96
Total noninterest expense
866
721
866
Income before provision for income
taxes
520
429
477
Provision for income taxes
119
94
77
Net income
401
335
400
Dividends on preferred stock
37
19
32
Net income available to common
shareholders
$ 364
$ 316
$ 368
Basic earnings per common share
$ 2.03
$ 1.81
$ 2.05
Diluted earnings per common share
$ 2.00
$ 1.79
$ 2.02
Weighted average shares—basic
180
175
179
Weighted average shares—diluted
182
177
182
CONSOLIDATED BALANCE
SHEETS
As of
($ in millions)
March 31, 2022
December 31,
2021
March 31, 2021
ASSETS
Cash and cash equivalents
$ 7,756
$ 12,947
$ 8,889
Debt securities available-for-sale
3,446
3,381
2,429
Debt securities held-to-maturity, net
26,831
22,292
19,232
Equity securities (fair value)
25
28
21
Loans:
Single family
81,833
76,793
65,179
Home equity lines of credit
2,597
2,584
2,392
Single family construction
1,041
993
842
Multifamily
16,953
15,966
14,141
Commercial real estate
8,753
8,531
8,065
Multifamily/commercial construction
1,955
1,927
2,101
Capital call lines of credit
10,970
10,999
8,654
Tax-exempt
3,656
3,680
3,455
Other business
4,081
3,961
3,679
PPP
232
545
2,142
Stock secured
3,651
3,435
2,520
Other secured
2,623
2,457
1,863
Unsecured
2,968
3,085
3,051
Total loans
141,313
134,956
118,084
Allowance for credit losses
(701
)
(694
)
(621
)
Loans, net
140,612
134,262
117,463
Investments in life insurance
2,682
2,650
2,329
Tax credit investments
1,231
1,220
1,127
Premises, equipment and leasehold
improvements, net
467
454
412
Goodwill and other intangible assets
221
222
226
Other assets
3,850
3,631
3,670
Total Assets
$ 187,121
$ 181,087
$ 155,798
LIABILITIES AND
SHAREHOLDERS’ EQUITY
Liabilities:
Deposits:
Noninterest-bearing checking
$ 72,424
$ 70,840
$ 53,807
Interest-bearing checking
41,589
41,248
32,543
Money market checking
21,846
20,303
19,210
Money market savings and passbooks
19,159
16,573
14,097
Certificates of deposit
7,042
7,357
8,250
Total Deposits
162,060
156,321
127,907
Long-term FHLB advances
3,700
3,700
10,505
Senior notes
999
998
997
Subordinated notes
779
779
778
Other liabilities
3,429
3,391
2,669
Total Liabilities
170,967
165,189
142,856
Shareholders’ Equity:
Preferred stock
3,633
3,633
2,143
Common stock
2
2
2
Additional paid-in capital
5,763
5,725
5,191
Retained earnings
6,893
6,569
5,627
Accumulated other comprehensive loss
(137
)
(31
)
(21
)
Total Shareholders’ Equity
16,154
15,898
12,942
Total Liabilities and Shareholders’
Equity
$ 187,121
$ 181,087
$ 155,798
Quarter Ended March
31,
Quarter Ended December
31,
2022
2021
2021
Average Balances, Yields and
Rates
Average Balance
Interest Income/Expense
(1)
Yield/ Rates (2)
Average Balance
Interest Income/Expense
(1)
Yield/ Rates (2)
Average Balance
Interest Income/Expense
(1)
Yield/ Rates (2)
($ in millions)
Assets:
Interest-bearing deposits with banks
$ 11,342
$ 5
0.18
%
$ 11,449
$ 3
0.10
%
$ 15,342
$ 6
0.15
%
Investment securities:
U.S. Government-sponsored agency
securities
117
0
1.37
%
94
0
1.45
%
100
0
1.59
%
Agency residential and commercial MBS
9,142
39
1.70
%
5,626
31
2.17
%
7,011
29
1.65
%
Other residential and commercial MBS
24
0
2.04
%
33
0
1.87
%
25
0
1.82
%
Tax-exempt municipal securities
15,595
151
3.87
%
12,270
127
4.14
%
14,869
146
3.93
%
Taxable municipal securities
1,715
13
2.97
%
1,079
8
2.95
%
1,670
12
2.99
%
Other investment securities
1,416
10
2.85
%
429
3
2.39
%
1,405
10
2.86
%
Total investment securities
28,009
213
3.04
%
19,531
169
3.45
%
25,080
197
3.15
%
Loans:
Residential real estate
82,416
567
2.75
%
65,459
469
2.87
%
78,436
545
2.78
%
Multifamily
16,281
140
3.45
%
13,922
123
3.53
%
15,479
154
3.90
%
Commercial real estate
8,633
82
3.77
%
8,033
78
3.88
%
8,525
83
3.82
%
Multifamily/commercial construction
1,929
22
4.62
%
2,867
31
4.34
%
2,044
24
4.70
%
Business
18,590
145
3.12
%
15,076
124
3.28
%
17,210
139
3.15
%
PPP
381
7
7.59
%
1,990
16
3.17
%
732
9
4.65
%
Other
9,058
47
2.06
%
7,348
39
2.16
%
8,578
45
2.03
%
Total loans
137,288
1,010
2.94
%
114,695
880
3.07
%
131,004
999
3.02
%
FHLB stock
115
2
7.60
%
345
5
6.10
%
143
4
11.17
%
Total interest-earning assets
176,754
1,230
2.78
%
146,020
1,057
2.90
%
171,569
1,206
2.79
%
Noninterest-earning cash
449
414
426
Goodwill and other intangibles
221
227
223
Other assets
7,142
6,091
6,967
Total noninterest-earning assets
7,812
6,732
7,616
Total Assets
$ 184,566
$ 152,752
$ 179,185
Liabilities and Shareholders’
Equity:
Deposits:
Interest-bearing checking
$ 40,400
1
0.01
%
$ 31,991
2
0.03
%
$ 36,896
1
0.01
%
Money market checking
21,659
5
0.09
%
18,889
8
0.16
%
21,925
5
0.10
%
Money market savings and passbooks
17,925
7
0.15
%
13,640
6
0.19
%
16,935
6
0.15
%
CDs
7,217
7
0.40
%
8,413
12
0.56
%
7,482
8
0.42
%
Total interest-bearing deposits (3)
87,201
20
0.09
%
72,933
28
0.15
%
83,238
20
0.10
%
Borrowings:
Short-term borrowings
—
—
—
%
0
0
0.18
%
—
—
—
%
Long-term FHLB advances
3,700
9
0.95
%
11,322
40
1.45
%
4,582
12
1.06
%
Senior notes
998
6
2.42
%
996
6
2.42
%
998
6
2.42
%
Subordinated notes
779
9
4.68
%
778
9
4.68
%
779
9
4.68
%
Total borrowings
5,477
24
1.75
%
13,096
55
1.72
%
6,359
27
1.72
%
Total interest-bearing liabilities (4)
92,678
44
0.19
%
86,029
83
0.39
%
89,597
47
0.21
%
Noninterest-bearing checking
72,251
51,689
71,308
Other noninterest-bearing liabilities
3,613
2,638
3,044
Total noninterest-bearing liabilities
75,864
54,327
74,352
Preferred shareholders’ equity
3,633
1,964
3,158
Common shareholders’ equity
12,391
10,432
12,078
Total Liabilities and Shareholders’
Equity
$ 184,566
$ 152,752
$ 179,185
Net interest spread (5)
2.59
%
2.50
%
2.58
%
Net interest income (fully
taxable-equivalent
basis) and net interest margin (6)
$ 1,186
2.68
%
$ 974
2.67
%
$ 1,159
2.68
%
Reconciliation of tax-equivalent net
interest income to net interest income: (7)
Municipal securities tax-equivalent
adjustment
(34
)
(28
)
(32
)
Business loans tax-equivalent
adjustment
(7
)
(7
)
(7
)
Net interest income
$ 1,145
$ 939
$ 1,120
Supplemental information:
Total deposits (interest-bearing and
noninterest-bearing)
$ 159,452
$ 20
0.05
%
$ 124,622
$ 28
0.09
%
$ 154,546
$ 20
0.05
%
Total deposits (interest-bearing and
noninterest-bearing) and borrowings
$ 164,929
$ 44
0.11
%
$ 137,718
$ 83
0.24
%
$ 160,905
$ 47
0.12
%
__________
Note: Certain prior period amounts have
been reclassified to conform to the current period
presentation.
(1) Interest income on tax-exempt
securities and loans has been adjusted to the fully
taxable-equivalent basis using the statutory federal income tax
rate
in effect for each respective period
presented.
(2) Yields/rates are annualized.
(3) Refer to supplemental information in
this table for average balances, interest expense and rates for
total deposits (interest-bearing and noninterest-
bearing).
(4) Refer to supplemental information in
this table for average balances, interest expense and rates for
total deposits (interest-bearing and noninterest-
bearing) and borrowings.
(5) Net interest spread represents the
average yield on interest-earning assets less the average rate on
interest-bearing liabilities.
(6) Net interest margin represents net
interest income on a fully taxable-equivalent basis divided by
total average interest-earning assets.
(7) Fully taxable-equivalent net interest
income is considered a non-GAAP financial measure, and is
reconciled to GAAP net interest income in this table.
Selected Financial Data and
Ratios
Quarter Ended
March 31,
Quarter Ended
December 31,
2022
2021
2021
($ in millions, except per share
amounts)
Selected Financial Data and
Ratios:
Return on average assets (1), (2)
0.88
%
0.89
%
0.89
%
Return on average common shareholders’
equity (1)
11.91
%
12.30
%
12.08
%
Return on average tangible common
shareholders’ equity (1), (3)
12.12
%
12.57
%
12.31
%
Average equity to average assets
8.68
%
8.12
%
8.50
%
Dividends per common share
$ 0.22
$ 0.20
$ 0.22
Dividend payout ratio
11.0
%
11.2
%
10.9
%
Efficiency ratio (4)
62.0
%
63.5
%
63.3
%
Selected Asset Quality Ratios:
Net loan charge-offs (recoveries)
$ (0.3
)
$ 0.5
$ 0.1
Net loan charge-offs (recoveries) to
average total loans (1)
(0.00
)%
0.00
%
0.00
%
Selected Ratios (period-end):
Book value per common share
$ 69.70
$ 61.26
$ 68.34
Tangible book value per common share
(5)
$ 68.47
$ 59.98
$ 67.10
__________
(1) Ratios are annualized.
(2) Return on average assets is the ratio
of net income to average assets.
(3) Refer to “Return on Average Common
Shareholders’ Equity and Return on Average Tangible Common
Shareholders’ Equity” table in this document
for a reconciliation of this non-GAAP
financial measure to the most comparable GAAP measure.
(4) Efficiency ratio is the ratio of
noninterest expense to the sum of net interest income and
noninterest income.
(5) Refer to “Book Value per Common Share
and Tangible Book Value per Common Share” table in this document
for a reconciliation of this non-GAAP
financial measure to the most comparable
GAAP measure.
Effective Tax Rate
Quarter Ended
March 31,
Quarter Ended
December 31,
2022
2021
2021
Effective tax rate, prior to excess tax
benefits—stock awards and research and
development tax credits from amended tax
returns
23.4
%
22.6
%
22.0
%
Excess tax benefits—stock awards
(0.5
)
(0.7
)
(1.5
)
Research and development tax credits from
amended tax returns
—
—
(4.4
)
Effective tax rate
22.9
%
21.9
%
16.1
%
Provision (Reversal of Provision) for
Credit Losses
Quarter Ended
March 31,
Quarter Ended
December 31,
2022
2021
2021
($ in millions)
Debt securities held-to-maturity
$ 1
$ 1
$ —
Loans
7
(14
)
26
Unfunded loan commitments
2
(2
)
(2
)
Total provision (reversal of
provision)
$ 10
$ (15
)
$ 24
Loan Originations
Quarter Ended
March 31,
Quarter Ended
December 31,
2022
2021
2021
($ in millions)
Single family
$ 8,376
$ 6,902
$ 7,013
Home equity lines of credit
689
624
617
Single family construction
267
225
245
Multifamily
1,709
791
1,723
Commercial real estate
566
314
597
Multifamily/commercial construction
384
311
190
Capital call lines of credit
3,020
3,131
3,690
Tax-exempt
90
214
130
Other business
538
1,025
650
PPP
—
689
—
Stock secured
1,136
710
966
Other secured
666
439
546
Unsecured
369
346
517
Total loans originated
$ 17,810
$ 15,721
$ 16,884
As of
Asset Quality Information
March 31, 2022
December 31,
2021
September 30,
2021
June 30, 2021
March 31, 2021
($ in millions)
Nonperforming assets:
Nonaccrual loans
$ 140
$ 139
$ 127
$ 133
$ 173
Other real estate owned
—
—
—
—
1
Total nonperforming assets
$ 140
$ 139
$ 127
$ 133
$ 174
Nonaccrual loans to total loans
0.10
%
0.10
%
0.10
%
0.11
%
0.15
%
Nonperforming assets to total assets
0.08
%
0.08
%
0.07
%
0.08
%
0.11
%
Accruing loans 90 days or more past
due
$ —
$ —
$ —
$ —
$ 1
Restructured accruing loans
$ 12
$ 13
$ 10
$ 11
$ 12
Allowance for loan credit losses to:
Total loans
0.50
%
0.51
%
0.52
%
0.52
%
0.53
%
Nonaccrual loans
498.8
%
500.5
%
524.4
%
479.3
%
359.3
%
As of
Loan Servicing Portfolio
March 31, 2022
December 31,
2021
September 30,
2021
June 30, 2021
March 31, 2021
($ in millions)
Loans serviced for investors
$ 4,298
$ 4,677
$ 5,117
$ 5,640
$ 6,314
Return on Average Common Shareholders’
Equity and Return on
Average Tangible Common Shareholders’
Equity (1), (2)
Quarter Ended
March 31,
Quarter Ended
December 31,
2022
2021
2021
($ in millions)
Average common shareholders’ equity
(a)
$ 12,391
$ 10,432
$ 12,078
Less: Average goodwill and other
intangible assets
(221
)
(227
)
(223
)
Average tangible common shareholders’
equity (b)
$ 12,170
$ 10,205
$ 11,855
Net income available to common
shareholders (c)
$ 364
$ 316
$ 368
Return on average common shareholders’
equity (c) / (a)
11.91
%
12.30
%
12.08
%
Return on average tangible common
shareholders’ equity (c) / (b)
12.12
%
12.57
%
12.31
%
__________
(1) Return on average tangible common
shareholders’ equity is considered a non-GAAP financial measure,
and is reconciled to GAAP return on average
common shareholders’ equity in this
table.
(2) Ratios are annualized.
Book Value per Common Share and
Tangible
Book Value per Common Share (1)
As of
March 31, 2022
December 31,
2021
September 30,
2021
June 30, 2021
March 31, 2021
(in millions, except per share
amounts)
Total shareholders’ equity
$ 16,154
$ 15,898
$ 14,802
$ 13,275
$ 12,942
Less: Preferred stock
(3,633
)
(3,633
)
(2,893
)
(2,143
)
(2,143
)
Total common shareholders’ equity (a)
12,521
12,265
11,909
11,132
10,799
Less: Goodwill and other intangible
assets
(221
)
(222
)
(223
)
(224
)
(226
)
Total tangible common shareholders’ equity
(b)
$ 12,300
$ 12,043
$ 11,686
$ 10,908
$ 10,573
Number of shares of common stock
outstanding (c)
180
179
179
177
176
Book value per common share (a) / (c)
$ 69.70
$ 68.34
$ 66.44
$ 62.99
$ 61.26
Tangible book value per common share (b) /
(c)
$ 68.47
$ 67.10
$ 65.19
$ 61.72
$ 59.98
__________
(1) Tangible book value per common share
is considered a non-GAAP financial measure, and is reconciled to
GAAP book value per common share in this
table.
Regulatory Capital Ratios and
Components (1), (2)
As of
March 31,
2022 (3)
December 31,
2021
September 30,
2021
June 30, 2021
March 31, 2021
($ in millions)
Capital Ratios:
Tier 1 leverage ratio (Tier 1 capital to
average assets)
8.70 %
8.76 %
8.55 %
8.05 %
8.32 %
Common Equity Tier 1 capital to
risk-weighted assets
9.48 %
9.65 %
9.81 %
9.51 %
9.64 %
Tier 1 capital to risk-weighted assets
12.25 %
12.56 %
12.25 %
11.38 %
11.60 %
Total capital to risk-weighted assets
13.37 %
13.72 %
13.45 %
12.60 %
12.87 %
Regulatory Capital:
Common Equity Tier 1 capital
$ 12,418
$ 12,045
$ 11,674
$ 10,875
$ 10,549
Tier 1 capital
$ 16,051
$ 15,678
$ 14,566
$ 13,018
$ 12,691
Total capital
$ 17,521
$ 17,124
$ 15,994
$ 14,421
$ 14,082
Assets:
Average assets
$ 184,410
$ 178,969
$ 170,373
$ 161,637
$ 152,465
Risk-weighted assets
$ 131,020
$ 124,820
$ 118,941
$ 114,406
$ 109,413
__________
(1) As defined by regulatory capital
rules.
(2) Beginning in 2020, ratios and amounts
reflect the Bank's election to delay the estimated impact of the
Current Expected Credit Losses (“CECL”)
allowance methodology on its regulatory
capital, average assets and risk-weighted assets over a five-year
transition period ending December 31,
2024.
(3) Ratios and amounts as of March 31,
2022 are preliminary.
As of
Wealth Management Assets
March 31, 2022
December 31,
2021
September 30,
2021
June 30, 2021
March 31, 2021
($ in millions)
First Republic Investment Management
$ 108,771
$ 109,130
$ 101,105
$ 99,459
$ 90,819
Brokerage and investment:
Brokerage
128,129
128,258
115,793
112,359
101,478
Money market mutual funds
18,543
23,673
18,074
13,109
11,435
Total brokerage and investment
146,672
151,931
133,867
125,468
112,913
Trust Company:
Trust
14,344
13,695
12,220
11,496
10,986
Custody
4,408
4,687
4,533
4,439
4,216
Total Trust Company
18,752
18,382
16,753
15,935
15,202
Total Wealth Management Assets
$ 274,195
$ 279,443
$ 251,725
$ 240,862
$ 218,934
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220413005241/en/
Investors: Andrew Greenebaum / Lasse Glassen Addo
Investor Relations agreenebaum@addo.com lglassen@addo.com (310)
829-5400
Media: Greg Berardi Blue Marlin Partners
gberardi@firstrepublic.com (415) 239-7826
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