2005 Highlights Include:
* Record net income of $17.3 million, up 6%
* Earnings per share of $.24, up 6%
* Return on equity of 16.76%
* Net charge-off ratio of only 13 basis points, well below peer
* Strong capital position, with Total risk-based capital of 12.98%
ANN ARBOR, Mich., April 14 /PRNewswire-FirstCall/ -- Republic Bancorp
Inc., (Nasdaq: RBNC), today announced record net income for the quarter ended
March 31, 2005 of $17,307,000, an increase of 6% over net income of
$16,299,000 earned in the first quarter of 2004. Diluted earnings per share
were $.24, up 6% from $.23 earned in 2004. Net income generated returns of
1.19% on average assets and 16.76% on average shareholders' equity for the
quarter ended March 31, 2005.
"We are very pleased to report another record quarter for the Company,"
commented Dana M. Cluckey, President and Chief Executive Officer. "Total
assets continued to grow compared to a year ago reaching $5.9 billion at
quarter end, driven by growth in all three targeted loan portfolios. Net
income and earnings per share increased 6% during the quarter, due to a 7%
increase in interest income resulting from the growth in earning assets. The
Company's capital position is very strong, with Total risk-based capital of
13%," added Mr. Cluckey.
Results for the first quarter of 2005 reflect solid performance from the
Company's three business lines.
Retail Banking
* The Company's installment loan portfolio, primarily home equity loans,
grew $100 million, or 16% compared to March 31, 2004. Total deposits during
the same period increased $102 million, or 4%.
Commercial Banking
* The commercial loan portfolio grew $54 million compared to prior year,
with the commercial real estate mortgage portfolio up 4%. Additionally, the
Company's commercial loan pipeline of loans in process continues to increase.
Mortgage Banking
* During the first quarter of 2005, the Company originated $345 million
in single-family residential mortgages, with over 40% of these closings being
adjustable rate loans. The residential real estate mortgage loan portfolio
increased $168 million, or 8% compared to March 31, 2004, primarily reflecting
the retention of adjustable rate mortgage loans. At March 31, 2005, the
Company's mortgage loan pipeline of applications in process was $539 million,
an increase of 54% over December 31, 2004.
Income Statement
Net interest income increased $2.4 million, or 7%, for the first quarter
of 2005 compared to 2004, due to the growth in average earning assets. For
the quarter ended March 31, 2005, the Company's net interest margin was 2.79%,
a decline of 3 basis points from March 31, 2004.
Total noninterest income increased $224,000, or 2%, for the first quarter
of 2005 compared to 2004, driven primarily by higher mortgage banking income.
Total noninterest expense increased $1.9 million, or 9%, for the first
quarter of 2005 compared to 2004. The increase was primarily a result of an
increase of $1.3 million in salaries and employee benefits related to employee
incentive accruals.
The Company's efficiency ratio for the quarter ended March 31, 2005 was
45.96%, which compares favorably to its peer group.
Asset Quality and Capital
The Company's asset quality remains very sound. Net charge-offs to total
average loans were only 13 basis points for the quarter ended March 31, 2005
and remain substantially below the Company's peer group.
During the first quarter of 2005, the Company repurchased 623,000 shares
at an average price of $14.20 per share under the 2003 Stock Repurchase
Program. The 2003 Stock Repurchase Program has 1,277,352 shares available for
repurchase at March 31, 2005.
The Company's capital ratios continue to be well in excess of the
requirements for a well-capitalized bank. At March 31, 2005, the Company's
Total risk-based capital ratio was a strong 12.98% and the Tier 1 leverage
ratio was 7.91%.
About the Company
Republic Bancorp Inc., with $5.9 billion in assets, is the third largest
bank holding company headquartered in Michigan and the 81st largest bank
holding company in the country. Its subsidiary, Republic Bank, serves
customers in Michigan, Ohio and Indiana with 95 retail, commercial and
mortgage banking offices and 90 ATMs. Republic has consistently been the #1
Small Business Administration bank lender based in Michigan and one of the
Midwest's top retail mortgage lenders. Republic was recently named as the 3rd
Best Company to Work For by FORTUNE magazine (marking the fifth year on
FORTUNE's "100 Best Companies to Work For") and named to Working Mother
magazine's list of "100 Best Companies for Working Mothers" for the fourth
year in a row.
Information about Republic Bancorp's financial results and its products
and services, including on-line mortgage applications and its Internet banking
system, ExpressNet, can be accessed at http://www.republicbancorp.com .
Cash Dividend
The Company currently pays an annual cash dividend of $.44 per share,
which represents an annual yield of approximately 3% based on the Company's
current stock price.
Safe Harbor Statement
As with any statements other than those reflecting historical facts,
forward-looking statements contained in this announcement involve risk, and,
as such, future financial performance may differ from current expectations due
to a variety of marketplace factors. These factors include, without
limitation, those disclosed in Republic Bancorp's most recent filings on Form
10-K with the Securities and Exchange Commission.
REPUBLIC BANCORP INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
March 31, Dec. 31, Sept. 30, March 31,
2005 2004 2004 2004
(Unaudited) (Unaudited) (Unaudited)
ASSETS
Cash and cash equivalents $54,440 $53,671 $61,070 $56,748
Mortgage loans held for sale 30,380 105,318 153,875 140,848
Securities available for
sale 835,939 620,794 682,343 713,265
Securities held to maturity
(at cost) 261,674 222,757 231,286 235,552
Loans 4,488,156 4,463,975 4,432,060 4,166,900
Less allowance for loan
losses (41,855) (41,818) (44,167) (41,556)
Net loans 4,446,301 4,422,157 4,387,893 4,125,344
Federal Home Loan Bank
stock (at cost) 80,514 80,511 80,508 80,503
Premises and equipment 25,630 26,493 26,868 28,570
Bank owned life insurance 113,335 112,978 111,883 109,633
Other assets 75,479 69,298 66,784 59,996
Total assets $5,923,692 $5,713,977 $5,802,510 $5,550,459
LIABILITIES
Noninterest-bearing
deposits $287,124 $274,747 $283,813 $273,056
Interest-bearing deposits:
NOW accounts 194,290 203,553 201,437 182,229
Savings and money market
accounts 1,070,683 1,103,675 1,049,146 1,064,319
Certificates of deposit
under $100,000 685,134 662,357 666,538 680,647
Certificates of deposit
$100,000 or greater 755,515 801,879 769,141 690,118
Total interest-bearing
deposits 2,705,622 2,771,464 2,686,262 2,617,313
Total deposits 2,992,746 3,046,211 2,970,075 2,890,369
Federal funds purchased
and other short-term
borrowings 810,133 538,300 533,841 560,044
Short-term FHLB advances 170,000 215,000 403,000 175,000
Long-term FHLB advances
and security repurchase
agreements 1,432,518 1,390,878 1,388,052 1,429,244
Accrued expenses and
other liabilities 63,347 63,950 55,149 58,902
Long-term debt 50,000 50,000 50,000 50,000
Total liabilities 5,518,744 5,304,339 5,400,117 5,163,559
SHAREHOLDERS' EQUITY
Preferred stock, $25 stated
value: $2.25 cumulative
and convertible; 5,000,000
shares authorized, none
issued and outstanding - - - -
Common stock, $5 par value;
75,000,000 shares authorized;
70,274,000, 70,425,000,
70,413,000, and 70,406,000
issued and outstanding,
respectively 351,369 352,125 320,058 320,028
Capital surplus 57,578 59,303 52,367 53,559
Unearned compensation -
restricted stock (7,194) (3,207) (3,674) (4,731)
Retained earnings 13,190 3,634 34,580 14,125
Accumulated other
comprehensive income (loss) (9,995) (2,217) (938) 3,919
Total shareholders'
equity 404,948 409,638 402,393 386,900
Total liabilities and
shareholders' equity $5,923,692 $5,713,977 $5,802,510 $5,550,459
REPUBLIC BANCORP INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
Three Months Ended
March 31,
2005 2004
Interest Income
Loans, including fees $64,464 $57,996
Investment securities and FHLB stock dividends 11,377 9,823
Total interest income 75,841 67,819
Interest Expense
Deposits 15,188 13,037
Short-term borrowings 5,620 2,018
Long-term FHLB advances and security
repurchase agreements 15,630 15,810
Long-term debt 1,075 1,075
Total interest expense 37,513 31,940
Net interest income 38,328 35,879
Provision for loan losses 1,500 2,500
Net interest income after provision for loan losses 36,828 33,379
Noninterest Income
Service charges 2,681 2,697
Mortgage banking income 5,825 5,174
Gain on sale of securities 435 688
Gain on sale of SBA loans 392 521
Income from bank owned life insurance 1,013 1,303
Other noninterest income 692 431
Total noninterest income 11,038 10,814
Noninterest Expense
Salaries and employee benefits 13,416 12,089
Occupancy expense of premises 2,701 2,619
Equipment expense 1,624 1,674
Other noninterest expense 5,131 4,640
Total noninterest expense 22,872 21,022
Income before income taxes 24,994 23,171
Provision for income taxes 7,687 6,872
Net income $17,307 $16,299
Basic earnings per share $.25 $.23
Diluted earnings per share $.24 $.23
REPUBLIC BANCORP INC.
SUMMARY OF SELECTED FINANCIAL DATA
(In thousands, except operating data)
Three Months Ended
March 31,
2005 2004
Operating Data (in millions):
Residential mortgage loan closings:
Fixed rate $203 $242
Adjustable rate 142 183
Total residential mortgage loan closings $345 $425
Conventional loans $194 $216
Government loans 30 43
Construction loans 34 40
Jumbo and other loans 87 126
Total residential mortgage loan closings $345 $425
Refinances (percent of total) 46% 47%
Performance Ratios (annualized for the quarter):
Return on average assets 1.19% 1.20%
Return on average equity 16.76% 17.15%
Net interest margin 2.79% 2.82%
Efficiency ratio (1) 45.96% 44.73%
Per Common Share Data:
Average common shares outstanding - diluted 71,201 71,084
Cash dividends declared $.11 $.086
Book value $5.76 $5.50
Tangible book value $5.69 $5.42
Mar. 31, Dec. 31, Sept. 30, Mar. 31,
2005 2004 2004 2004
Capital Ratios:
Shareholders' equity to assets 6.84% 7.20% 6.93% 6.97%
Tier 1 risk-based capital 11.83% 11.87% 11.67% 11.84%
Total risk-based capital 12.98% 12.96% 12.82% 12.99%
Tier 1 leverage 7.91% 7.94% 7.80% 7.89%
(1) Includes total noninterest expense, divided by total revenue (FTE),
excluding gain on sale of securities.
REPUBLIC BANCORP INC.
SUMMARY OF SELECTED FINANCIAL DATA
(Dollars in thousands)
Three Months Ended Three Months Ended
March 31, 2005 March 31, 2004
Average Average Average Average
Balance Interest Rate Balance Interest Rate
Average Assets:
Short-term investments $2,067 $9 1.67% $439 $1 0.75%
Mortgage loans held for
sale 113,635 1,662 5.85 92,827 1,374 5.92
Securities available
for sale:
Taxable 529,900 5,980 4.51 461,584 4,503 3.90
Tax-exempt 199,848 2,702 5.48 209,999 3,080 5.87
Securities held to
maturity 234,708 2,691 4.59 188,664 2,170 4.60
Portfolio loans:
Commercial loans 1,586,114 24,470 6.17 1,526,471 21,116 5.47
Residential real
estate mortgage
loans 2,120,187 27,506 5.19 2,027,648 27,086 5.34
Installment loans 736,509 10,826 5.96 628,980 8,420 5.37
Total loans, net of
unearned income 4,442,810 62,802 5.67 4,183,099 56,622 5.39
FHLB stock 80,712 827 4.15 80,734 1,057 5.25
Total interest-
earning assets 5,603,680 76,673 5.49 5,217,346 68,807 5.26
Allowance for loan
losses (41,762) (40,923)
Cash and due from banks 51,151 52,282
Other assets 206,811 189,026
Total assets $5,819,880 $5,417,731
Average Liabilities and
Shareholders' Equity:
Interest-bearing
demand deposits $200,481 $222 0.45% $183,744 $124 0.27%
Savings and money
market accounts 1,084,171 4,209 1.57 1,041,338 3,467 1.34
Certificates of deposit
under $100,000 673,495 4,878 2.94 679,605 5,148 3.04
Certificates of deposit
$100,000 or greater 781,919 5,879 3.05 668,233 4,298 2.58
Total interest-
bearing deposits 2,740,066 15,188 2.25 2,572,920 13,037 2.03
Short-term borrowings 893,359 5,620 2.52 727,657 2,018 1.10
Long-term FHLB advances
and security repurchase
agreements 1,411,945 15,630 4.43 1,396,219 15,810 4.48
Long-term debt 50,000 1,075 8.60 50,000 1,075 8.60
Total interest-
bearing
liabilities 5,095,370 37,513 2.96 4,746,796 31,940 2.68
Noninterest-bearing
deposits 270,015 254,371
Other liabilities 41,445 36,479
Total liabilities 5,406,830 5,037,646
Shareholders' equity 413,050 380,085
Total liabilities
and shareholders'
equity $5,819,880 $5,417,731
Net interest
income/rate spread
(FTE) $39,160 2.53% $36,867 2.58%
FTE adjustment $832 $988
Impact of noninterest-
bearing sources of funds 0.26% 0.24%
Net interest margin (FTE) 2.79% 2.82%
REPUBLIC BANCORP INC.
SUMMARY OF SELECTED FINANCIAL DATA
(Dollars in thousands)
March 31, Dec. 31, Sept. 30, March 31,
2005 2004 2004 2004
Portfolio Loan Summary:
Commercial loans:
Commercial and industrial $31,159 $32,632 $37,712 $38,659
Commercial real estate
mortgage 1,565,291 1,542,660 1,517,746 1,504,112
Total commercial
loans 1,596,450 1,575,292 1,555,458 1,542,771
Residential real estate
mortgages 2,149,917 2,152,720 2,160,835 1,982,025
Installment loans 741,789 735,963 715,767 642,104
Total portfolio loans $4,488,156 $4,463,975 $4,432,060 $4,166,900
Non-performing assets:
Non-accrual loans:
Commercial $18,705 $17,744 $23,456 $24,124
Residential real estate
mortgage 12,560 10,705 10,330 11,656
Installment 1,095 852 1,071 639
Total non-accrual loans 32,360 29,301 34,857 36,419
Restructured loans - - - -
Other real estate owned 5,163 4,160 4,161 3,729
Total non-performing
assets $37,523 $33,461 $39,018 $40,148
Allowance for Loan Losses (for the quarter):
Balance at beginning of
period $41,818 $44,167 $43,086 $40,271
Loans charged off:
Commercial 579 753 1,279 1,344
Residential real estate
mortgage 594 379 227 71
Installment 527 386 327 420
Total charge-offs 1,700 1,518 1,833 1,835
Recoveries:
Commercial 63 17 410 427
Residential real estate
mortgage - 35 32 -
Installment 174 184 222 193
Total recoveries 237 236 664 620
Net charge-offs 1,463 1,282 1,169 1,215
Provision charged to expense 1,500 1,750 2,250 2,500
Reclassification of allowance
for loan losses
on unfunded loan
commitments(1) - (2,817) - -
Balance at end of period $41,855 $41,818 $44,167 $41,556
(1) During the fourth quarter of 2004, the Company reclassified $2.8
million of its allowance for loan losses to a separate allowance for probable
credit losses inherent in unfunded loan commitments. Net income and prior
period balances were not affected by this reclassification. The separate
allowance is included in "accrued expenses and other liabilities".
REPUBLIC BANCORP INC.
SUMMARY OF SELECTED FINANCIAL DATA
(Dollars in thousands)
March 31, Dec. 31, Sept. 30, March 31,
2005 2004 2004 2004
Asset Quality Ratios:
Non-performing assets to loans
and other real estate owned .84% .75% .88% .96%
Non-performing assets to total
assets .63% .59% .67% .72%
Allowance for loan losses
to non-performing loans 129.34% 142.72% 126.71% 114.11%
Allowance for loan losses
to loans .93% .94% 1.00% 1.00%
Allowance for loan losses to
loans (excluding residential
real estate mortgages) 1.79% 1.81% 1.94% 1.90%
Net charge-offs to average loans: (1)
Commercial loans .13% .19% .23% .24%
Residential real estate
mortgage loans .11% .06% .04% .01%
Installment loans .19% .11% .06% .14%
Total loans .13% .11% .11% .12%
(1) Quarter-to-date, annualized.
SOURCE Republic Bancorp Inc.
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Related links:
http://www.republicbancorp.com
CONTACT:
Thomas F. Menacher, Exec. V.P., Treasurer &
CFO, tmenacher@republicbancorp.com , or Kristine D. Brenner,
Director of Investor Relations, kbrenner@republicbancorp.com, of
Republic Bancorp Inc., +1-989-725-7337
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