Note 8 - Borrowings

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Debt Disclosure [Text Block]

8. Borrowings

Republic has a line of credit with FHLB of Pittsburgh with a maximum borrowing capacity of $1.3 billion as of December 31, 2021. As of December 31, 2021 and 2020, there were no fixed term borrowings against this line of credit. There were no overnight borrowings outstanding as of December 31, 2021 and 2020. At December 31, 2021 and 2020, FHLB had issued letters of credit, on Republic’s behalf, totaling $100.0 million and $150.0 million respectively, against its available credit line, primarily to be used as collateral for public funds deposit balances. There were no fixed term advances outstanding at any month-end during 2021 and 2020.  At December 31, 2021, $1.8 billion of loans collateralized the FHLB line of credit. No overnight borrowings were outstanding at any month-end in 2021 and 2020.

Republic has a line of credit in the amount of $10.0 million available for the purchase of federal funds through the ACBB. At December 31, 2021 and 2020, Republic had no amount outstanding against the line at ACBB. There were no overnight advances on this line at any month end in 2021 and 2020.

Republic also has a line of credit with Zions Bank of $15.0 million to assist in managing our liquidity position. At December 31, 2021 and 2020, Republic had no amount outstanding against the line at Zions Bank. There were no overnight balances on this line at any month end in 2021 and 2020.

As part of the CARES Act, the Federal Reserve Bank of Philadelphia offered secured discounted borrowings to banks that originated PPP loans through the Paycheck Protection Program Liquidity Facility or PPPLF program. The Company did not pledge any PPP loans or borrow any funds as part of the PPPLF program at December 31, 2021 since the PPPLF program was discontinued on July 30, 2021. The Company pledged $633.9 million of PPP loans to the Federal Reserve Bank of Philadelphia to borrow $633.9 million of funds at a rate of 0.35% at December 31, 2020.

Trust Preferred Securities:

The Company has two outstanding issues of 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 1 capital for regulatory purposes in an amount up to 25% of total Tier 1 capital.

In 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 3-month LIBOR. The Company may call the securities on any interest payment date after five years without a prepayment penalty.

On June 28, 2007, Republic Capital Trust III (“Trust III”) issued $5.0 million of trust preferred securities to investors and $0.2 million of 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 3-month LIBOR.  The Company has the ability to call the securities on any interest payment date without a prepayment penalty.

Deferred issuance costs included in subordinated debt were $63,000 and $70,000 at December 31, 2021 and December 31, 2020, respectively. Amortization of deferred issuance costs was $7,000, $6,000, and $6,000 in the years ended December 31, 2021, 2020, and 2019, respectively.