Republic First Bank closed and sold to Fulton Bank by US regulators
Republic First Bank, a commercial bank based in Philadelphia, USA, has been closed and sold to fellow Pennsylvania-based firm Fulton Bank by US regulators.
Republic First Bank sold to Fulton Bank by FDIC
Republic First was closed by the Pennsylvania Department of Banking and Securities on Friday, with the Federal Deposit Insurance Corporation (FDIC) appointed as receiver.
The FDIC says it has entered into an agreement with Fulton Bank to “assume substantially all of the deposits and purchase substantially all of the assets” of Republic First to “protect depositors”.
Republic First held around $6 billion in total assets and $4 billion in total deposits as of 31 January, with the regulator estimating the cost of its failure at $667 million, which will be covered by the country’s Deposit Insurance Fund (DIF).
Upon the closure of the transaction this week, the FDIC says all of the 32 branches previously maintained by Republic First across New Jersey, Pennsylvania and New York will reopen as branches of Fulton Bank.
The closure and sale comes after Republic First previously reported last July that it was implementing a new strategy in a bid to bring down costs, adding that the value of its mortgage loan portfolio had “declined substantially in a rising rate environment”.
It had attempted to cut costs with a plan to “wind down and exit” its mortgage origination business and “exit non-core markets, consolidate branches and refocus on the company’s core metropolitan Philadelphia and Southern New Jersey markets”.
The bank signed a letter of intent with the Norcross-Braca Group shortly after this announcement in the hope of receiving “a new investment of at least $35 million”, but the deal later fell through in February.
