Republic First Bancorp (FRBKQ) 8-K Reports Fourth Quarter Earnings

NEWS RELEASE

FOR RELEASE IMMEDIATELY

Contact:  Paul Frenkiel, CFO

(215) 735-4422  ext. 5255

REPUBLIC FIRST BANCORP, INC.

REPORTS FOURTH QUARTER EARNINGS

Philadelphia, PA, January 18, 2008 – Republic First Bancorp, Inc. (NASDAQ:FRBK), (the “Company”) the holding company for Republic First Bank (PA), today reported fourth quarter 2007 earnings of $1.6 million or $.15 per diluted share, compared to $2.5 million or $.23* per diluted share for the same quarter in 2006.  Average loans outstanding increased 7% in fourth quarter 2007 compared to fourth quarter 2006.

The $.08 per share reduction in earnings in fourth quarter 2007 compared to fourth quarter 2006 primarily reflected the $.06 per share reduction from lower rates on variable rate loans due to rate reductions in 2007 totaling 100 basis points, a $.02 per share reduction due to the carrying costs of the Company’s existing non-performing loans, and $.01 per share due to an increase in reserves for loan losses.  This factor was partially offset by a favorable $.01 per share from loan growth.

For fourth quarter 2007, interest income decreased $676,000 to $16.4 million from $17.1 million for fourth quarter 2006. The decrease was due primarily to the reduction of interest income from rate reductions on variable rate loans as a result of actions taken by the Federal Reserve and the increase in non-performing loans, partially offset by the increase in average loans outstanding.

For fourth quarter 2007, interest expense increased $408,000 to $9.2 million from $8.8 million for fourth quarter 2006.  The increase was due primarily to additional funding for loan growth.  The rate on total interest bearing deposits increased 4 basis points to 4.56% in fourth quarter 2007 compared to 4.52% for the same period in 2006.  The rate on total interest bearing liabilities decreased 3 basis points to 4.62% in fourth quarter 2007 compared to 4.65% for the same period in 2006 as the cost of overnight borrowings decreased as a result of the actions taken by the Federal Reserve.

Net interest income for fourth quarter 2007 of $7.2 million was $1.1 million less than the fourth quarter of 2006 as a result of the above factors. Fourth quarter net interest margin was 3.08% compared to the 3.71% recorded in the fourth quarter of 2006. The reduction was due primarily to the 74 basis point decrease in the rate on total loans due to lower returns on variable rate loans and the increase in non-performing loans from $6.9 million at December 31, 2006 to $22.3 million at December 31, 2007.

The Company has historically resolved problem loans with nominal loss.  Non-performing assets increased $0.5 million, or only 1.9%, from $25.5 million at September 30, 2007 to $26.0 million at December 31, 2007.  With the $.01 per share increase in the provision for loan losses, the Company has maintained an allowance for loan losses to total loans ratio of 1.04%.  Management believes the loan loss reserve is adequate at current levels based upon charge-off history and monthly analysis of problem loans.

Harry D. Madonna, Chairman and Chief Executive Officer, stated, “Our fourth quarter earnings were hurt by the decrease in interest income from variable rate loans caused by the reductions in rates by the Federal Reserve Board, continuing high cost of deposits despite the Federal Reserve Board’s actions and assets which became non-performing earlier this year.  We anticipate that our earnings will increase as the cost of deposits declines as the year progresses.  We also anticipate that we will be able to sell a large portion of our non-performing loans or collateral securing those loans by the end of the second quarter.  We have also developed a number of fee based products which should increase our income in 2008.”

Total shareholders’ equity stood at $80.1 million with a book value per share of $7.76 at December 31, 2007, based on outstanding common shares of approximately 10.3 million.  The Company continues to be well capitalized.

 Republic First Bank (PA) is a full-service, state-chartered commercial bank, whose deposits are insured by the Federal Deposit Insurance Corporation (FDIC).  The Bank provides diversified financial products through its eleven offices located in Abington, Ardmore, Bala Cynwyd, Plymouth Meeting, Media and Philadelphia, Pennsylvania and Voorhees, New Jersey.

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.  These forward-looking statements include statements with respect to the Company's beliefs, plans, objectives, goals, expectations, anticipations, estimates, and intentions that are subject to significant risks and uncertainties and are subject to change based on various factors, many of which are beyond the Company's control. The words “may”, “could”, “should”, “would”, “believe”, “anticipate”, “estimate”, “expect”, “intend”, “plan”, and similar 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 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.

# # #

*  Prior year earnings per share amounts were restated to reflect the 10% stock dividend paid April 17, 2007.

Attachment  #1
Republic First Bancorp, Inc.
Condensed Income Statement
(Dollar amounts in thousands
except per share data)
(unaudited)
	Three Months Ended								Twelve Months Ended
	December 31								December 31
		2007			2006					2007		2006
Net Interest Income		$	7,160		$	8,244				$	30,039	$	34,066
Provision for Loan Losses			165			(10	)				1,590		1,364
Non-interest Income			918			807					3,073		3,640
Non-interest Expenses			5,598			5,351					21,364		21,017
Provision for income taxes			738			1,225					3,273		5,207
Net Income		$	1,577		$	2,485				$	6,885	$	10,118
Diluted EPS		$	0.15		$	0.23		(1)		$	0.65	$	0.95	(1)
Republic First Bancorp, Inc.
Condensed Balance Sheet
(Dollar amounts in thousands)
(unaudited)
Assets		December 31,			December 31,
		2007			2006
Federal Funds Sold and Other Interest Bearing Cash		$	62,229		$	63,673
Investment Securities			90,299			109,176
Commercial and Other Loans			821,549			792,060
Allowance for Loan Losses			(8,508	)		(8,058	)
Other Assets			52,914			51,973
Total Assets		$	1,018,483		$	1,008,824
Liabilities and Shareholders' Equity:
Transaction Accounts		$	357,920		$	385,950
Time Deposit Accounts			422,935			368,823
FHLB Advances and Trust Preferred Securities			144,774			165,909
Other Liabilities			12,734			13,408
Shareholders' Equity			80,120			74,734
Total Liabilities and Shareholders' Equity		$	1,018,483		$	1,008,824
(1) Prior year earnings per share has been restated for the 10% stock dividend paid April 17, 2007.

Attachment #2
Republic First Bancorp, Inc.
December 31, 2007
(unaudited)
	At or For  the				At or For  the
	Three Months Ended				Twele Months Ended
	December 31,		December 31,		December 31,		December 31,
Financial Data:	2007		2006		2007		2006
Return on average assets	0.65	%	1.07	%	0.71	%	1.19	%
Return on average equity	7.88	%	13.43	%	8.86	%	14.59	%
Share information:
Book value per share	$7.76		$7.16	(1)	$7.76		$7.16	(1)
Actual shares outstanding at period end, net of
treasury shares (416,311 and 275,611 shares, respectively)	10,321,000		10,445,000	(1)	10,321,000		10,445,000	(1)
Average diluted shares outstanding	10,557,000		10,719,000	(1)	10,662,000		10,698,000	(1)
(1) Prior year share information has been restated for the 10% stock dividend payable April 17, 2007.

Attachment #3
Republic First Bancorp, Inc.
December 31, 2007
(Dollars in thousands)
(unaudited)
Credit Quality Ratios:
	December 31,			September 30,			December 31,
	2007			2007			2006
Non-accrual and loans accruing,
but past due 90 days or more	$	22,280		$	25,435		$	6,916
Restructured loans		-			-			-
Total non-performing loans		22,280			25,435			6,916
Other real estate owned		3,681			42			572
Total non-performing assets	$	25,961		$	25,477		$	7,488
	Twelve Months			Nine Months			Twelve Months
	Ended			Ended			Ended
	December 31,			September 30,			December 31,
	2007			2007			2006
Allowance for Loan Losses
Balance at beginning of period	$	8,058		$	8,058		$	7,617
Charge-offs:
Commercial and construction		1,503			1,028			601
Tax refund loans		-			-			1,286
Consumer		3			2			-
Total charge-offs		1,506			1,030			1,887
Recoveries:
Commercial and construction		81			81			37
Tax refund loans		283			256			927
Consumer		2			1			-
Total recoveries		366			338			964
Net charge-offs		1,140			692			923
Provision for loan losses		1,590			1,425			1,364
Balance at end of period	$	8,508		$	8,791		$	8,058
Non-performing loans as
a percentage of total loans		2.71	%		3.02	%		0.87	%
Nonperforming assets as
a percentage of total assets		2.55	%		2.45	%		0.74	%
Allowance for loan losses
to total loans		1.04	%		1.04	%		1.02	%
Allowance for loan losses
to total non-performing loans		38.19	%		34.56	%		116.51	%

Attachment #4
Republic First Bancorp, Inc.
December 31, 2007
(Dollars in thousands )
(unaudited)
			Quarter-to-Date
			Average Balance Sheet
	Three months ended							Three months ended
	December 31, 2007							December 31, 2006
					Average							Average
Interest-Earning Assets:	Average				Yield/			Average				Yield/
	Balance		Interest		Cost			Balance		Interest		Cost
Commercial and other loans	$	823,751	$	15,018		7.23	%	$	770,473	$	15,481		7.97	%
Investment securities		87,240		1,244		5.70			83,524		1,209		5.79
Federal funds sold		12,439		143		4.56			28,390		391		5.46
Total interest-earning assets		923,430		16,405		7.05			882,387		17,081		7.68
Other assets		42,437							37,410
Total assets	$	965,867	$	16,405				$	919,797	$	17,081
Interest-bearing liabilities:
Interest-bearing deposits	$	679,640	$	7,818		4.56	%	$	658,955	$	7,502		4.52	%
Borrowed funds		115,121		1,427		4.92			94,561		1,335		5.60
Interest-bearing liabilities		794,761		9,245		4.62			753,516		8,837		4.65
Non-interest and
interest-bearing funding		873,813		9,245		4.20			833,141		8,837		4.21
Other liabilities:		12,628							13,263
Total liabilities		886,441							846,404
Shareholders' equity		79,426							73,393
Total liabilities &
shareholders' equity	$	965,867						$	919,797
Net interest income			$	7,160						$	8,244
Net interest margin						3.08	%						3.71	%

Attachment #5
Republic First Bancorp, Inc.
December 31, 2007
(Dollars in thousands )
(unaudited)
			Year-to-Date
			Average Balance Sheet
	Twelve months ended							Twelve months ended
	December 31, 2007							December 31, 2006
					Average							Average
Interest-Earning Assets:	Average				Yield/			Average				Yield/
	Balance		Interest		Cost			Balance		Interest		Cost
Commercial and other loans	$	820,380	$	62,184		7.58	%	$	728,754	$	58,254		7.99	%
Investment securities		95,715		5,476		5.72			57,163		3,282		5.74
Federal funds sold		13,923		686		4.93			25,884		1,291		4.99
Total interest-earning assets		930,018		68,346		7.35			811,801		62,827		7.74
Other assets		39,888							36,985
Total assets	$	969,906	$	68,346				$	848,786	$	62,827
Interest-bearing liabilities:
Interest-bearing deposits	$	666,676	$	31,186		4.68	%	$	597,637	$	23,783		3.98	%
Borrowed funds		133,122		7,121		5.35			88,609		4,896		5.53
Interest-bearing liabilities		799,798		38,307		4.79			686,246		28,679		4.18
Non-interest and
interest-bearing funding		878,439		38,307		4.36			768,479		28,679		3.73
Other liabilities:		13,760							10,981
Total liabilities		892,199							779,460
Shareholders' equity		77,707							69,326
Total liabilities &
shareholders' equity	$	969,906						$	848,786
Net interest income			$	30,039						$	34,148
Net interest margin						3.23	%						4.20	%