Executive Summary

Q3 2021 delivered solid operating leverage: Total revenue rose to $38.8M (+18% YoY) while non‑interest expense (ex‑goodwill) increased 4%; diluted EPS was $0.08 versus $(0.02) YoY and flat sequentially .
Deposits continued to scale efficiently: total deposits reached $4.97B (+27% YoY, +9% QoQ) with cost of funds at 0.36%, down from 0.59% YoY; the net interest margin was 2.54% (down 10bps QoQ, up 19bps YoY) .
Loan mix normalizing as PPP runs off: gross loans declined 5% YoY to $2.50B, but excluding PPP, loans grew 15% YoY to $2.26B; PPP fees deferred were ~$9M to be recognized over remaining life .
Asset quality and capital strong: NPAs/Assets improved to 0.25%; Total Risk‑Based Capital 12.53%, Tier 1 Leverage 6.50% at the holding company; book value per share was $4.67 (+8% YoY) .
Wall Street consensus via S&P Global was unavailable in our dataset for FRBK; beats/misses versus estimates cannot be assessed for this quarter.

What Went Well and What Went Wrong

What Went Well

Deposit growth and funding cost: deposits grew $1.07B (+27% YoY) to $4.97B while cost of funds fell to 0.36%, supporting NIM resilience and earnings momentum .
Core loan growth ex‑PPP: loans ex‑PPP increased $296M (+15% YoY) on strength in owner‑occupied CRE, commercial real estate, and residential mortgage, evidencing relationship banking traction .
Asset quality: NPAs/Assets improved to 0.25%, coverage rose to 133%, and net charge‑offs remained near zero, limiting credit cost volatility .

Management quote: “The Power of Red is Back expansion strategy continues to build momentum… Deposits continue to grow at rates far above industry standards and loan growth remains robust…” — Vernon W. Hill, II, Chairman .

What Went Wrong

Mortgage banking headwind: non‑interest income fell to $7.3M from $10.0M YoY driven by lower residential refinance activity; this subdued fee contributions versus the prior year .
Sequential NIM pressure: NIM declined 10bps QoQ to 2.54% due to higher cash balances, moderating PPP fee recognition versus Q1/Q2 .
Provision normalization: provision was $0.9M versus $0 in Q2 2021 and $0.85M in Q3 2020, modestly weighing on pre‑tax income growth sequentially .

Financial Results

Metric	Q3 2020	Q2 2021	Q3 2021
Total Revenue ($USD Millions)	$32.96	$38.32	$38.76
Net Interest Income ($USD Millions)	$22.93	$30.64	$31.44
Non-Interest Income ($USD Millions)	$10.03	$7.68	$7.32
Provision for Loan Losses ($USD Millions)	$0.85	$0.00	$0.90
Non-Interest Expense ($USD Millions)	$33.58 (incl. $5.01 goodwill)	$30.52	$29.78
Pre-Tax Income ($USD Millions)	$(1.47)	$7.80	$8.08
Net Income ($USD Millions)	$(0.97)	$5.93	$6.10
Diluted EPS ($USD)	$(0.02)	$0.08	$0.08
Net Interest Margin (%)	2.35%	2.64%	2.54%
Cost of Funds (%) (avg deposits)	0.58%	0.42%	0.36%

Segment breakdown – Deposits ($USD Thousands):

Description	Q3 2020	Q2 2021	Q3 2021
Demand noninterest-bearing	$1,049,169	$1,258,162	$1,346,353
Demand interest-bearing	$1,618,342	$1,945,833	$2,162,324
Money market and savings	$1,034,799	$1,168,516	$1,265,926
Certificates of deposit	$203,296	$187,357	$197,478
Total deposits	$3,905,606	$4,559,868	$4,972,081

Segment breakdown – Loans ($USD Thousands):

Description	Q3 2020	Q2 2021	Q3 2021
Commercial & industrial	$228,145	$212,003	$250,650
Owner occupied real estate	$427,026	$478,547	$496,301
Commercial real estate	$676,460	$736,293	$775,168
Construction & land development	$164,671	$160,945	$153,132
Residential mortgage	$365,279	$459,712	$496,963
Consumer & other	$99,975	$93,125	$85,680
Sub-total (excl PPP)	$1,961,556	$2,140,625	$2,257,894
Paycheck Protection Program	$667,842	$380,798	$239,120
Gross Loans	$2,629,398	$2,521,423	$2,497,014

KPIs and balance sheet/capital:

KPI	Q3 2020	Q2 2021	Q3 2021
Non-performing assets / total assets (%)	0.27%	0.26%	0.25%
Allowance for loan losses / gross loans (%)*	0.45%	0.64%	0.69%
Non-performing loan coverage (%)	95%	134%	133%
Quarterly net loan charge-offs / avg loans (%)	0.01%	0.00%	0.00%
Book value per common share ($)	$4.33	$4.62	$4.67
Total Risk-Based Capital (Bancorp, %)	—	13.31%	12.53%
Tier 1 Risk-Based Capital (Bancorp, %)	—	12.69%	11.92%
Tier 1 Leverage Ratio (Bancorp, %)	—	7.28%	6.50%

*Allowance excluding PPP loans as per company’s disclosure .

Guidance Changes

No formal quantitative guidance (revenue, EPS, margins, OpEx, tax rate, dividends) was disclosed in the Q3 2021 8‑K press release or other materials reviewed. As such, there are no guidance ranges to compare or track changes this quarter .

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY/Q4	Not provided in materials reviewed	Not provided	—
EPS	FY/Q4	Not provided	Not provided	—
NIM / Cost of Funds	FY/Q4	Not provided	Not provided	—
OpEx	FY/Q4	Not provided	Not provided	—
Tax Rate	FY/Q4	Not provided	Not provided	—
Dividends (common)	FY/Q4	Not provided	Not provided	—

Note: Preferred dividends continued ($0.875M in Q3) as previously disclosed .

Earnings Call Themes & Trends

The Q3 2021 earnings call transcript was not retrievable via our tools; themes below are synthesized from company’s Q3, Q2, and Q1 earnings releases.

Topic	Previous Mentions (Q1 2021)	Previous Mentions (Q2 2021)	Current Period (Q3 2021)	Trend
Deposit growth & funding cost	Deposits +48% YoY to $4.36B; deposit cost 0.48% (avg)	Deposits +25% YoY to $4.56B; deposit cost 0.42% (avg)	Deposits +27% YoY to $4.97B; deposit cost 0.36% (avg)	Improving funding mix/cost
PPP loans & fee amortization	~$1B PPP originated; ~$16M fees deferred	PPP forgiveness ~$600M; ~$13M fees deferred	PPP loans down to $239M; ~$9M fees deferred	PPP runoff, fee tail declining
Mortgage banking	Strong refinance‑driven income ($4.56M in Q1)	Lower non‑interest income; securities gains did not recur	Non‑interest income down YoY on lower mortgage banking	Moderating/refi slowdown
Store expansion & customer experience	31 stores; Deptford and Ocean City openings planned; focus on omnichannel	32 stores; ongoing tech investment	32 stores; Ocean City opening expected Q4 2021; omnichannel emphasis	Gradual expansion
Asset quality	NPAs/Assets 0.27%; deferrals down to ~$2.7M	NPAs/Assets 0.26%	NPAs/Assets 0.25%; coverage 133%	Stable/improving credit
Capital & book value	TBV/book up; leverage 8.13%; RBC 13.46%	Leverage 7.28%; TRBC 13.31%; BVPS $4.62	Leverage 6.50%; TRBC 12.53%; BVPS $4.67	Strong but leverage impacted by deposit growth

Management Commentary

“The Power of Red is Back expansion strategy continues to build momentum and deliver strong results across all fronts at Republic. Earnings have improved significantly over the last twelve months. Deposits continue to grow at rates far above industry standards and loan growth remains robust…” — Vernon W. Hill, II, Chairman .
“As we grow, we remain laser focused on our commitment to deliver the best experience across every channel that our customers have access to… This approach creates FANS… driving tremendous organic growth quarter after quarter.” — Vernon W. Hill, II .

Q&A Highlights

The Q3 2021 earnings call transcript could not be retrieved via our tools due to a database inconsistency; as a result, detailed Q&A highlights and any clarifications provided on the call are unavailable from primary sources this quarter.

Estimates Context

Wall Street consensus via S&P Global for FRBK was unavailable in our dataset this quarter; therefore, comparisons to consensus (EPS, revenue, EBITDA) and assessment of beats/misses cannot be performed.

Key Takeaways for Investors

Operating leverage intact: revenue growth (+18% YoY) with controlled expense growth (+4% YoY ex‑goodwill) continues to drive earnings; diluted EPS of $0.08 matched Q2 and improved markedly YoY .
Funding advantage strengthens: deposit growth with lower cost of funds (0.36%) supports net interest income; watch for NIM trajectory as cash balances normalize and PPP fee amortization fades .
Core lending growth ex‑PPP is robust: +15% YoY ex‑PPP, led by CRE/resi mortgage; PPP runoff will reduce reported loan balances but improve mix and simplify optics over time .
Fee income headwinds from mortgage banking likely persist if refinance volumes stay lower; monitor non‑interest income diversification (SBA gains, service fees) .
Credit quality strong with high coverage and minimal net charge‑offs; limited near‑term credit cost risk supports earnings durability .
Capital and book value trending higher YoY; leverage ratio moderated as assets/deposits grew—earnings support capital build, but leverage may remain sensitive to growth .
Near-term trading lens: absent consensus estimates, catalysts include continued deposit growth, stabilization of NIM, and clarity on PPP fee runoff; any sequential improvement in NIM or fee income could be viewed positively .

All data and statements are sourced from the company’s Q3, Q2, and Q1 2021 earnings 8‑K releases and embedded exhibits as cited above.

REPUBLIC FIRST BANCORP INC (FRBK)·Q3 2021 Earnings Summary