UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒   Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2021

or

◻   Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File Number: 0-24649

REPUBLIC BANCORP, INC.

(Exact name of registrant as specified in its charter)

Kentucky	61-0862051
(State of other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

601 West Market Street, Louisville, Kentucky	40202
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (502) 584-3600

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Class A Common	RBCAA	The Nasdaq Stock Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ⌧ Yes ◻ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ⌧ Yes ◻ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ◻	Accelerated filer ⌧	Non-accelerated filer ◻	Smaller reporting company ◻
Emerging growth company ◻

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ◻ Yes ☒ No

The number of shares outstanding of the registrant’s Class A Common Stock and Class B Common Stock, as of April 30, 2021, was 18,593,543 and 2,197,634.

TABLE OF CONTENTS

PART I — FINANCIAL INFORMATION
Item 1.	Financial Statements.	4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	63
Item 3.	Quantitative and Qualitative Disclosures about Market Risk.	96
Item 4.	Controls and Procedures.	96
PART II — OTHER INFORMATION
Item 1.	Legal Proceedings.	96
Item 1A.	Risk Factors.	97
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	98
Item 6.	Exhibits.	99
	SIGNATURES	100

2

GLOSSARY OF TERMS

The terms identified in alphabetical order below are used throughout this Form 10-Q. You may find it helpful to refer to this page as you read this report.

Term	Definition
ACH	Automated Clearing House
ACL	Allowance for Credit Losses
ACLC	Allowance for Credit Losses on Off-Balance Sheet Credit Exposures
ACLL	Allowance for Credit Losses on Loans
ACLS	Allowance for Credit Losses on Securities
AFS	Available for Sale
AOCI	Accumulated Other Comprehensive Income
ASC	Accounting Standards Codification
ASU	Accounting Standards Update
Basic EPS	Basic earnings per Class A Common Share
BOLI	Bank Owned Life Insurance
BPO	Brokered Price Opinion
C&D	Construction and Development
C&I	Commercial and Industrial
CARES Act	Coronavirus Aid, Relief, and Economic Security Act
CECL	Current Expected Credit Loss
CMO	Collateralized Mortgage Obligation
Core Bank	The Traditional Banking, Warehouse Lending, and Mortgage Banking reportable segments
COVID-19	Coronavirus Disease of 2019
CRE	Commercial Real Estate
Diluted EPS	Diluted earnings per Class A Common Share
EA	Easy Advance
Economic Aid Act	The Economic Aid to Hard Hit Small Business, Not for Profits and Venues Act
ESPP	Employee Stock Purchase Plan
EVP	Executive Vice President
FASB	Financial Accounting Standards Board
FDIC	Federal Deposit Insurance Corporation
FFTR	Federal Funds Target Rate
FHLB	Federal Home Loan Bank
FHLMC	Federal Home Loan Mortgage Corporation
FICO	Fair Isaac Corporation
FNMA	Federal National Mortgage Association
FOMC	Federal Open Market Committee
FRB	Federal Reserve Bank
FTE	Full Time Equivalent
FTP	Funds Transfer Pricing
GAAP	Generally Accepted Accounting Principles in the United States
HEAL	Home Equity Amortizing Loan
HELOC	Home Equity Line of Credit
HTM	Held to Maturity
IRS	Internal Revenue Service
ITM	Interactive Teller Machine
LGD	Loss Given Default
LIBOR	London Interbank Offered Rate
LPO	Loan Production Office
LTV	Loan to Value
MBS	Mortgage-backed Securities
MSRs	Mortgage Servicing Rights
NA	Not Applicable
NM	Not Meaningful
OBS	Off-Balance Sheet
OCI	Other Comprehensive Income
OREO	Other Real Estate Owned
OTTI	Other than Temporary Impairment
PCD	Purchased with Credit Deterioration
PCI	Purchased Credit Impaired
PD	Probability of Default
PPP	SBA's Paycheck Protection Program
PPPLF	The FRB's Paycheck Protection Program Liquidity Facility
Prime	The Wall Street Journal Prime Interest Rate
Provision	Provision for Expected Credit Loss Expense
PSU	Performance Stock Unit
QF	Qualitative Factor
R&D	Research and Development
RB&T / the Bank	Republic Bank & Trust Company
RBCT	Republic Bancorp Capital Trust
RCS	Republic Credit Solutions segment
Republic / the Company	Republic Bancorp, Inc.
RPG	Republic Processing Group
RPS	Republic Payment Solutions
RT	Refund Transfer
SBA	U.S. Small Business Administration
SEC	Securities and Exchange Commission
SSUAR	Securities Sold Under Agreements to Repurchase
SVP	Senior Vice President
TDR	Troubled Debt Restructuring
The Captive	Republic Insurance Services, Inc.
TPS	Trust Preferred Securities
TRS	Tax Refund Solutions segment
TRUP	TPS Investment
Warehouse	Warehouse Lending segment

3

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements.

CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands)

	March 31,		December 31,
	2021		2020
ASSETS
Cash and cash equivalents	$	984,857	$	485,587
Available-for-sale debt securities, at fair value (amortized cost of $468,144 in 2021 and $512,518 in 2020, allowance for credit losses of $0 in 2021 and $0 in 2020)		477,475		523,863
Held-to-maturity debt securities (fair value of $52,909 in 2021 and $54,190 in 2020, allowance for credit losses of $103 in 2021 and $178 in 2020)		52,147		53,324
Equity securities with readily determinable fair value		2,821		3,083
Mortgage loans held for sale, at fair value		63,636		46,867
Consumer loans held for sale, at fair value		3,970		3,298
Consumer loans held for sale, at the lower of cost or fair value		11,701		1,478
Loans (loans carried at fair value of $417 in 2021 and $497 in 2020)		4,666,593		4,813,103
Allowance for credit losses		(75,336)		(61,067)
Loans, net		4,591,257		4,752,036
Federal Home Loan Bank stock, at cost		13,153		17,397
Premises and equipment, net		38,324		39,512
Right-of-use assets		41,911		43,345
Goodwill		16,300		16,300
Other real estate owned		2,015		2,499
Bank owned life insurance		68,408		68,018
Other assets and accrued interest receivable		108,565		111,718
TOTAL ASSETS	$	6,476,540	$	6,168,325
LIABILITIES
Deposits:
Noninterest-bearing	$	2,276,348	$	1,890,416
Interest-bearing		2,995,144		2,842,765
Total deposits		5,271,492		4,733,181
Securities sold under agreements to repurchase and other short-term borrowings		175,580		211,026
Operating lease liabilities		42,854		44,340
Federal Home Loan Bank advances		25,000		235,000
Subordinated note		41,240		41,240
Other liabilities and accrued interest payable		82,665		80,215
Total liabilities		5,638,831		5,345,002
Commitments and contingent liabilities (Footnote 9)		—		—
STOCKHOLDERS’ EQUITY
Preferred stock, no par value		—		—
Class A Common Stock and Class B Common Stock, no par value		4,884		4,899
Additional paid in capital		143,563		143,637
Retained earnings		682,264		666,278
Accumulated other comprehensive income		6,998		8,509
Total stockholders’ equity		837,709		823,323
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	6,476,540	$	6,168,325

See accompanying footnotes to consolidated financial statements.

4

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(in thousands, except per share data)

<

	Three Months Ended
	March 31,
	2021		2020
INTEREST INCOME:
Loans, including fees	$	67,386	$	77,513
Taxable investment securities		1,952		2,783
Federal Home Loan Bank stock and other		219		863
Total interest income		69,557		81,159
INTEREST EXPENSE:
Deposits		1,565		6,302
Securities sold under agreements to repurchase and other short-term borrowings		9		119
Federal Home Loan Bank advances		31		1,648
Subordinated note		172		352
Total interest expense		1,777		8,421
NET INTEREST INCOME		67,780		72,738
Provision for expected credit loss expense		15,262		22,760
NET INTEREST INCOME AFTER PROVISION		52,518		49,978
NONINTEREST INCOME:
Service charges on deposit accounts		2,873		3,136
Net refund transfer fees		12,721		15,823
Mortgage banking income		7,193		4,795
Interchange fee income		3,027		2,552
Program fees		2,225		2,624
Increase in cash surrender value of bank owned life insurance		390		389
Net gains (losses) on other real estate owned		(11)		3
Other		619