Republic First Sold to Fulton in Latest Regional Bank Failure

Philadelphia-based lender Republic First Bancorp has been sold after being seized by regulators.

Fulton Bank, another Pennsylvania financial institution, has agreed to acquire the lender — which does business as Republic Bank — and its assets, the Federal Deposit Insurance Corp. (FDIC) announced late Friday (April 26).

“The FDIC determined that compared to other alternatives, Fulton Bank’s acquisition of Republic Bank is the least costly resolution for the DIF, an insurance fund created by Congress in 1933 and managed by the FDIC to protect the deposits at the nation’s banks,” the regulator said in a news release. 

“Republic Bank is the first U.S. bank failure this year; the last failure was Citizens Bank, Sac City, Iowa on November 3, 2023.”

With the deal, Fulton says it has purchased assets of about $6 billion, including an investment portfolio of about $2 billion and roughly $2.9 billion in loans. It also takes on liabilities of about $5.3 billion, including about $4 billion in deposits and other borrowings and liabilities of about $1.3 billion.

“With this transaction, we are excited to double our presence across the region,” said Fulton Chairman and CEO Curt Myers. “We look forward to welcoming Republic Bank’s team members and customers to Fulton and providing our comprehensive set of consumer, commercial and wealth advisory products and services to even more customers.”

The announcement comes days after reports that the FDIC was in talks with potential buyers for Republic Bank, whose market value had plummeted to under $1 million for much of this month after peaking at above $500 million in 2017.

The FDIC had tried to find buyers for the bank last year, though that effort was put on hold when Republic First found an investor who was set to pump $35 million into the bank, though that deal was called off in February.

Writing to shareholders last year, the bank’s leaders noted Republic First had gone through “some difficult times,” citing an “ill-advised” expansion of the bank’s physical footprint and building up long-term fixed-rate residential loan and bond portfolios amid low interest rates.

Earlier this month, former FDIC Chair Sheila Bair warned that she was concerned about the regional banking sector after the failure of three lenders last year.

“I’m worried about a handful of them,” said Bair, who headed the FDIC during the financial crisis of 2008, in an interview with CNBC.

“I think some of them are still overly reliant on industry deposits, have a lot of concentrated commercial real estate exposure, and then I think the larger picture really is the potential instability of their uninsured deposits even for the healthy ones if we have another bank failure.”