2016 ACQUISITION OF CORNERSTONE BANCORP, INC. (Tables)

9 Months Ended

Sep. 30, 2017

2016 ACQUISITION OF CORNERSTONE BANCORP, INC.

Summary of Assets Acquired and Liabilities Assumed

Summary of Assets Acquired and Liabilities Assumed
		May 17, 2016
	As Previously Reported					As Recasted
		As Recorded		Fair Value			Recast			As Recorded
(in thousands)		by Cornerstone		Adjustments			Adjustments			by Republic
Assets acquired:
Cash and cash equivalents	$	22,707	$	—		$	—		$	22,707
Investment securities		329		—			—			329
Loans		195,136		(5,525)	a		13	a		189,624
Allowance for loan and lease losses		(1,955)		1,955	a		—			—
Loans, net		193,181		(3,570)			13			189,624
Federal Home Loan Bank stock, at cost		224		—			—			224
Premises and equipment, net		7,770		4,457	b		—			12,227
Core deposit intangible		—		1,205	c		—			1,205
Deferred income taxes		3,714		(74)	d		—			3,640
Bank owned life insurance		7,461		—			—			7,461
Other assets and accrued interest receivable		658		—			—			658
Total assets acquired	$	236,044	$	2,018		$	13		$	238,075
Liabilities assumed:
Deposits:
Noninterest-bearing	$	52,908	$	—		$	—		$	52,908
Interest-bearing		152,257		92	e		—			152,349
Total deposits		205,165		92			—			205,257
Subordinated note		4,124		—			—			4,124
Other liabilities and accrued interest payable		2,244		787	f		—			3,031
Total liabilities assumed		211,533		879			—			212,412
Net assets acquired	$	24,511	$	1,139		$	13			25,663
Cash consideration paid										(31,795)
Goodwill									$	6,132

Explanation of fair value adjustments

a. Reflects the fair value adjustment based on the Company’s evaluation of the acquired loan portfolio and to eliminate the acquiree’s recorded allowance for loan losses.

b. Reflects the fair value adjustment based on the Company’s evaluation of the premises and equipment acquired.

c. Reflects the fair value adjustment for the core deposit intangible asset recorded as a result of the acquisition.

d. Reflects the differences in the carrying values of acquired assets and assumed liabilities for financial reporting purposes and their basis for federal income tax purposes.

e. Reflects the fair value adjustment based on the Company’s evaluation of the assumed time deposits.

f. Reflects the amount needed to adjust other liabilities to estimated fair value and to record certain liabilities directly attributable to the acquisition of Cornerstone.