SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K-A
AMENDMENT #1
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) NOVEMBER 7, 1997
Republic Bancorp, Inc.
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(Exact name of registrant as specified in its charter)
Kentucky 33-77324 61-0862051
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(State or other
jurisdiction of (Commission (I.R.S. Employer
incorporation) File Number) Identification No.)
601 West Market Street, Louisville, Kentucky 40202
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(Address of principal executive offices) (Zip code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (502) 584-3600
Not Applicable
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(Former name or former address, if changed since last report)
Republic has amended its filing on Form 8-K to provide the pro forma financial
information required under Item 7. Additionally, Republic has updated its
previous disclosures under Item 2 to reflect more current information.
ITEM 2. DISPOSITION OF ASSETS
During 1997, Republic elected to focus its resources on its North Central
and Central Kentucky markets. As a result of this decision, management
pursued opportunities to sell certain fixed assets and deposits of its
Western Kentucky banking centers, with the exception of Owensboro.
Republic's Western Kentucky assets contracted for sale include banking
centers in the cities of Murray, Benton, Paducah, and Mayfield. These
banking centers are comprised of approximately $180 million in deposits
and approximately $3.8 million in fixed assets. Republic expects to retain
substantially all of the loan portfolio associated with these banking
centers in the amount of approximately $159 million.
The pricing and other terms of these asset dispositions were arrived at
through arms-length negotiations with various potentially interested
parties. In addition to comparing offers, management evaluated terms
offered by prospective purchasers to information regarding pricing of
similar transactions. To the extent the purchase price in a transaction is
less than the deposit liabilities being assumed by the purchaser, the
transaction involves a cash payment by Republic to the purchaser.
Management has primarily funded the transactions closed through the date
of this filing with $14 million in additional deposits at its existing
banking centers, liquidation of investment securities and overnight fed
funds in the amount of $40 million and additional advances from the
Federal Home Loan Bank (FHLB) totaling approximately $85 million.
On April 1, 1997, Republic entered into an agreement to sell its Murray
banking center to United Commonwealth Bank, FSB. The transaction included
the sale of real estate located in Murray, Kentucky, certain fixed assets,
and a transfer of certain deposit liabilities totaling approximately $18
million. The transaction was closed on July 30, 1997 and Republic
recognized a pre-tax gain of approximately $1.7 million.
On July 21, 1997, Republic entered into an agreement to sell its Benton
banking center to The Peoples First National Bank and Trust Company of
Paducah. The transaction included the sale of real estate located in
Benton, Kentucky, certain fixed assets, and a transfer of certain deposit
liabilities totaling approximately $31 million. The transaction was closed
on September 23, 1997 and Republic recognized a pre-tax gain of
approximately $2.2 million.
On July 18, 1997, Republic entered into an agreement to sell its Paducah
banking centers to The Paducah Bank and Trust Company. The transaction
included the sale and lease of real estate located in Paducah, Kentucky,
certain fixed assets, and a transfer of certain deposit liabilities
totaling approximately $65 million. The transaction was closed on November
7, 1997 and Republic recognized a pre-tax gain of approximately $3.6
million.
Republic has also entered into a contract to sell its Mayfield banking
center to First Federal Savings Bank of Leitchfield. The transaction will
include the sale of real estate located in Mayfield, Kentucky, certain
fixed assets, and a transfer of certain deposit liabilities totaling
approximately $66 million. The Mayfield transaction is expected to close
during January of 1998. Management anticipates that Republic will realize
a pre-tax gain of approximately $4 million on this transaction. Such gain
will be dependent upon the attributes and the amount of the liabilities
assumed by the purchasers at closing. Republic anticipates that it will
fund this transaction primarily through additional advances from the FHLB.
ITEM 7. FINANCIAL STATEMENTS AND PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
b. Pro Forma Consolidated Financial Statements (unaudited) Republic
Bancorp, Inc.
The following pro forma consolidated balance sheet as of September 30,
1997, and the pro forma consolidated statements of income for the nine
month period then ended and the year ended December 31, 1996 give
effect to the sale of Republic's four banking centers. The adjustments
related to the pro forma consolidated balance sheet assumes the
transactions were consummated at September 30, 1997, while the
adjustments to the pro forma condensed consolidated income statements
assume the transaction was consummated at the beginning of the period
presented. The final sale of the Mayfield banking center is expected to
occur in January, 1998.
The pro forma information is based on the historical financial
statements of Republic.
These pro forma statements are not necessarily indicative of the
results that actually would have occurred if the sales had been in
effect as of and for the periods presented or what may be achieved in
the future.
REPUBLIC BANCORP, INC. AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
SEPTEMBER 30, 1997 (dollars in thousands)
CONSOLIDATED
REPUBLIC PRO FORMA PRO FORMA
ASSETS: BANCORP ADJUSTMENTS CONSOLIDATED
Cash and cash equivalents:
Cash and due from banks $ 18,923 $ 18,923
Federal funds sold 16,900 $ (16,900) [d]
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Total cash and cash equivalents 35,823 (16,900) 18,923
Securities available for sale 98,428 (23,100) [d] 75,328
Securities to be held to maturity 108,590 108,590
Loans, less allowance for loan losses
$6,281 (1997) and $6,241 (1996) 801,369 801,369
Mortgage loans held for sale 14,758 14,758
Federal Home Loan Bank stock 7,083 7,083
Accrued interest receivable 9,367 9,367
Premises and equipment, net 16,037 (3,495) [c] 12,542
Other assets 3,960 3,960
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TOTAL $ 1,095,415 $ (43,495) $ 1,051,920
============ =========== ============
LIABILITIES:
Deposits:
Non-interest bearing $ 64,839 $ (4,036) [a] $ 60,803
Interest bearing 701,451 (127,191) [a] 588,260
14,000 [f]
Securities sold under agreements to repurchase
and other short-term borrowings 101,422 101,422
Other borrowed funds 136,831 68,792 [e] 205,623
Accrued interest payable 7,166 7,166
Guaranteed preferred beneficial interests in
Company's subordinated debentures 6,452 6,452
Other liabilities 9,581 9,581
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Total liabilities 1,027,742 (48,435) 979,307
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred Stock, no par value; authorized 100,000
shares; Series A 8.5%
noncumulative convertible, 50,000 shares issued and
outstanding (liquidation preference $5,000) 5,000 5,000
Class A Common stock, no par value
Class B Common stock, no par value 3,494 3,494
Additional paid-in capital 6,885 6,885
Retained earnings 52,365 4,940 [b] 57,305
Net unrealized depreciation on securities
available for sale, net of tax (71) (71)
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Total stockholders' equity 67,673 4,940 72,613
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TOTAL $ 1,095,415 $ (43,495) $ 1,051,920
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REPUBLIC BANCORP, INC. AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 ( IN THOUSANDS)
CONSOLIDATED
REPUBLIC PRO FORMA PRO FORMA
INTEREST INCOME: BANCORP ADJUSTMENTS CONSOLIDATED
Loans, including fees $ 57,723 $ (1,045) [g] $ 56,678
Securities available for sale 4,417 (1,250) [h] 3,167
Securities to be held to maturity:
Taxable 5,668 5,668
Non-taxable 94 94
FHLB dividends 362 362
Other 499 (499) [h] ------
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Total interest income 68,763 (2,794) 65,969
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INTEREST EXPENSE:
Deposits 29,678 (6,384) [i] 23,294
Short-term borrowings 3,435 3,435
Long-term debt 5,204 5,127 [j] 10,331
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Total interest expense 38,317 (1,257) 37,060
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NET INTEREST INCOME 30,446 (1,537) 28,909
PROVISION FOR LOAN LOSSES 3,850 3,850
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NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 26,596 (1,537) 25,059
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NON-INTEREST INCOME:
Service charges on deposit accounts 2,440 (492) [k] 1,948
Bank card services 508 508
Loan servicing income 556 556
Net gain on sale of deposits 3,900 3,900 [m]
Net gain on sale of bank card 3,410 3,410
Net gain on sale of loans 1,073 1,073
Net gain on sale of securities 90 90
Other 1,068 (44) [k] 1,024
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Total non-interest income 13,045 (536) 12,509
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NON-INTEREST EXPENSE:
Salaries and employee benefits 11,681 (1,024) [l] 10,657
Occupancy and equipment 5,856 (827) [l] 5,029
Communication and transportation 1,358 (208) [l] 1,150
Marketing and development 979 (123) [l] 856
FDIC deposit insurance 53 (21) [l] 32
Supplies 757 (45) [l] 712
Other 3,504 (665) [l] 2,839
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Total non-interest expense 24,188 (2,913) 21,275
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INCOME BEFORE INCOME TAXES 15,453 840 16,293
INCOME TAXES 5,525 294 [n] 5,819
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NET INCOME $ 9,928 $ 546 $ 10,474
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REPUBLIC BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 1996 (IN THOUSANDS)
CONSOLIDATED ADJUSTED
REPUBLIC CONSOLIDATED
INTEREST INCOME: BANCORP ADJUSTMENTS REPUBLIC BANCORP
Loans, including fees $ 70,831 $ (1,584) [g] $ 69,247
Securities to be held to maturity:
Taxable 9,375 (991) [h] 8,384
Non-taxable 127 127
FHLB dividends 378 378
Other 1,275 (1,275) [h]
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Total interest income 81,986 (3,850) 78,136
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INTEREST EXPENSE:
Deposits 36,084 (9,337) [i] 26,747
Short-term borrowings 3,481 3,481
Long-term debt 4,290 7,696 [j] 11,986
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Total interest expense 43,855 (1,641) 42,214
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NET INTEREST INCOME 38,131 (2,209) 35,922
PROVISION FOR LOAN LOSSES 9,149 9,149
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NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 28,982 (2,209) 26,773
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NON-INTEREST INCOME:
Service charges on deposit accounts 2,642 (620) [k] 2,022
Other service charges and fees 445 445
Bank card services 1,010 1,010
Net gain on sale of loans 1,212 1,212
Loan servicing income 829 829
Other 959 (53) [k] 906
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Total non-interest income 7,097 (673) 6,424
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NON-INTEREST EXPENSE:
Salaries and employee benefits 13,236 (1,077) [l] 12,159
Occupancy and equipment 6,623 (928) [l] 5,695
Communication and transportation 1,548 (281) [l] 1,267
Marketing and development 1,620 (209) [l] 1,411
FDIC deposit insurance 3,277 (260) [l] 3,017
Supplies 973 (178) [l] 795
Other 4,132 (799) [l] 3,333
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Total non-interest expense 31,409 (3,732) 27,677
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INCOME BEFORE INCOME TAXES 4,670 850 5,520
INCOME TAXES 1,943 298[n] 2,241
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NET INCOME $ 2,727 $ 552 $ 3,279
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REPUBLIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
a. Sale of deposits
b. After-tax gain on branch sales after September 30, 1997
c. Sale of fixed assets
d. Securities sold or matured used to fund sale of deposits
e. FHLB Advances used to fund sale of deposits
f. Increase in deposits at existing banking centers
g. Reduction in interest income on loans due to annual estimated loan run-off
of 20% using average yield on loans for the nine months ended
September 30, 1997 and the twelve months ended December 31, 1996
h. Reduction in interest income due to liquidation of investments
using average yield on investments for the nine months ended
September 30, 1997 and the twelve months ended December 31, 1996
i. Reduction in interest expense due to sale of deposits using average cost
of deposits for the nine months ended September 30, 1997 and the twelve
months ended December 31, 1996
j. Increase in interest expense on FHLB borrowings using average cost of
borrowings for the nine months ended September 30, 1997 and the twelve
months ended December 31, 1996
k. Reduction of non-interest income and deposit fee income as a result of
sale of deposits
l. Reduction in non-interest expense related to sold banking centers
m. Represents gain on sale of Murray and Benton deposits which occurred prior
to September 30, 1997
n. Assumed tax rate of 35%
c. The exhibits furnished as a part of Form 8-K are identified in, and
immediately follow, the Exhibit Index appearing on page 10 of this report.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
Republic Bancorp, Inc.
(Registrant)
Principal Executive Officer:
Date: January 5, 1998 /s/Bernard M. Trager
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Bernard M. Trager
Chairman and Chief Executive Officer
Principal Financial Officer:
Date: January 5, 1998 /s/Mark A. Vogt
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Mark A. Vogt
Senior Vice President,
Chief Financial Officer
EXHIBIT INDEX
EXHIBIT DESCRIPTION
2.1 Agreement to Purchase Assets and Assume Liabilities dated
April 1, 1997 by and between United Commonwealth Bank, FSB and
Republic Bank & Trust Company (Previously filed)
2.2 Purchase and Assumption Agreement dated July 18, 1997 between The
Paducah Bank & Trust Company and Republic Bank & Trust Company
(Previously filed)
2.3 Purchase and Assumption Agreement dated July 21, 1997 between
Peoples First National Bank & Trust Company and Republic Bank &
Trust Company (Previously filed)
2.4 Purchase and Assumption Agreement dated September 12, 1997
between First Federal Savings Bank of Leitchfield and Republic
Bank & Trust Company (Previously filed)