8.	Borrowings

Republic has a line of credit with the Federal Home Loan Bank (“FHLB”) of Pittsburgh with a maximum borrowing capacity of

$860.5

million as of

December 31, 2019.

As of

December 31, 2019

and

2018,

there were

fixed term borrowings against this line of credit. There were

overnight borrowings outstanding as of

December 31, 2019.

As of

December 31, 2018,

we had overnight borrowings of

$91.4

million at a rate of

2.65%

against this line of credit. As of

December 31, 2019

and

2018,

FHLB had issued letters of credit, on Republic’s behalf, totaling

$150.0

million and

$100.0

million, respectively, against its available credit line, primarily to be used as collateral for public funds deposit balances. There were

fixed term advances outstanding at any month-end during

2019

and

2018.

December 31, 2019,

$1.2

billion of loans collateralized the overnight advance and the letter of credit. The maximum amount of overnight borrowings outstanding at any month-end was

$69.0

million in

2019

and

$206.9

million in

2018.

Republic also has a line of credit in the amount of

$10.0

million available for the purchase of federal funds through the Atlantic Community Bankers Bank (“ACBB”). At

December 31, 2019

and

2018,

Republic had

amount outstanding against the line at ACBB. There were

overnight advances on this line at any month end in

2019

and

2018.

Republic also established a line of credit with Zions Bank in the amount of

$15.0

million to assist in managing our liquidity position during the year ended

December 31, 2018.

December 31, 2019

and

2018,

Republic had

amount outstanding against the line at Zions Bank. There were

overnight balances on this line at any month end in

2019

and

2018.

Subordinated debt and corporation-obligated-mandatorily redeemable capital securities of subsidiary trust holding solely junior obligations of the corporation:

The Company has sponsored

two

outstanding issues of corporation-obligated mandatorily redeemable capital securities of a subsidiary trust holding solely junior subordinated debentures of the corporation, more commonly known as trust preferred securities. The subsidiary trusts are

not

consolidated with the Company for financial reporting purposes. The purpose of the issuances of these securities was to increase capital. The trust preferred securities qualify as Tier

capital for regulatory purposes in an amount up to

25%

of total Tier

capital.

December 2006,

Republic Capital Trust II (“Trust II”) issued

$6.0

million of trust preferred securities to investors and

$0.2

million of common securities to the Company. Trust II purchased

$6.2

million of junior subordinated debentures of the Company due

2037,

and the Company used the proceeds to call the securities of Republic Capital Trust I (“Trust I”). The debentures supporting Trust II have a variable interest rate, adjustable quarterly, at

1.73%

over the

-month Libor. The Company

may

call the securities on any interest payment date after

five

years without a prepayment penalty.

June 28, 2007,

the Company caused Republic Capital Trust III (“Trust III”), through a pooled offering, to issue

$5.0

million of trust preferred securities to investors and

$0.2

million common securities to the Company. Trust III purchased

$5.2

million of junior subordinated debentures of the Company due

2037,

which have a variable interest rate, adjustable quarterly, at

1.55%

over the

month Libor. The Company has the ability to call the securities on any interest payment date without a prepayment penalty.

June 10, 2008,

the Company caused Republic First Bancorp Capital Trust IV (“Trust IV”) to issue

$10.8

million of convertible trust preferred securities as part of the Company’s strategic capital plan. The securities were purchased by various investors, including Vernon W. Hill, II, founder and chairman (retired) of Commerce Bancorp and, since

December 5, 2016,

chairman of the Company. This investor group also included a family trust of Harry D. Madonna, president and chief executive officer of Republic First Bancorp, Inc, and Theodore J. Flocco, Jr., who, since the investment, has been elected to the Company’s Board of Directors and serves as the Chairman of the Audit Committee. Trust IV also issued

$0.3

million of common securities to the Company. Trust IV purchased

$11.1

million of junior subordinated debentures due

2038,

which paid interest at an annual rate of

8.0%

and were callable after the

fifth

year under certain terms and conditions. The trust preferred securities of Trust IV were convertible into approximately

1.7

million shares of common stock of the Company, based on a conversion price of

$6.50

per share of Company common stock. One independent director converted

$240,000

of trust preferred securities into

37,000

shares of common stock in

2017.

January 31, 2018,

the Company notified the existing holders of Trust IV of its intent to fully redeem these securities in accordance with the Optional Redemption terms included in the Indenture Agreement. The securities were redeemed on

March 31, 2018

at a price equal to the outstanding principal amount. The holders had the option to convert these securities into shares of the Company’s common stock at any time until the end of the last business day preceding the redemption date. During the

first

quarter of

2018,

$10.1

million of trust preferred securities were converted into

1.6

million shares of common stock. After redemption of the remaining securities on

March 31 2018,

Trust IV was dissolved.

Deferred issuance costs included in subordinated debt were

$76,000

and

$82,000

December 31, 2019

and

December 31, 2018,

respectively. Amortization of deferred issuance costs were

$6,000,

and

$29,000

for the years ended

December 31, 2019,

2018,

and

2017,

respectively. Deferred issuance costs in the amount of

$467,000

were recorded against additional paid in capital during the

first

quarter of

2018

as a result of the conversion of trust preferred securities into common stock in accordance with ASC

470

20.