Republic Bancorp(RBCAA) - 2025 Q3 - Quarterly Results

Balance Sheet Data Republic Bancorp, Inc.'s balance sheet data for the third quarter of 2025 shows a slight increase in total assets and stockholders' equity compared to the previous quarter, while total deposits also saw a modest rise | Metric (in thousands) | Sep. 30, 2025 | Jun. 30, 2025 | Sep. 30, 2024 | | :-------------------- | :------------ | :------------ | :------------ | | Total assets | $7,014,919 | $6,970,917 | $6,692,470 | | Loans, net | $5,201,509 | $5,291,260 | $5,214,759 | | Total deposits | $5,338,345 | $5,317,239 | $5,101,696 | | Stockholders' equity | $1,084,520 | $1,060,106 | $979,705 | - Total assets increased by $44.0 million (0.63%) from June 30, 2025, to September 30, 2025, and by $322.4 million (4.82%) year-over-year from September 30, 2024[4] - Total deposits increased by $21.1 million (0.40%) from June 30, 2025, to September 30, 2025, and by $236.6 million (4.64%) year-over-year from September 30, 2024[4] Average Balance Sheet Data The average balance sheet data for the third quarter of 2025 shows a slight decrease in total average assets and interest-earning assets compared to the previous quarter, but an increase year-over-year | Metric (in thousands) | Three Months Ended Sep. 30, 2025 | Three Months Ended Jun. 30, 2025 | Three Months Ended Sep. 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Total assets | $6,991,878 | $7,062,031 | $6,711,818 | | Total interest-earning assets | $6,564,354 | $6,627,798 | $6,312,419 | | Total interest-bearing liabilities | $4,524,343 | $4,538,969 | $4,281,727 | - Average total assets decreased by $70.2 million (1.0%) quarter-over-quarter but increased by $280.1 million (4.2%) year-over-year[6] - Average total interest-earning assets decreased by $63.4 million (1.0%) quarter-over-quarter but increased by $251.9 million (4.0%) year-over-year[6] Total Company Average Balance Sheets and Interest Rates For the three months ended September 30, 2025, Republic Bancorp reported an increase in net interest income and net interest margin compared to the same period in 2024, driven by higher yields on investment securities and traditional bank loans | Metric | Three Months Ended Sep. 30, 2025 | Three Months Ended Sep. 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | | Net interest income (in thousands) | $76,970 | $71,305 | | Net interest spread | 3.94 % | 3.59 % | | Net interest margin | 4.65 % | 4.49 % | | Average Rate - Total interest-earning assets | 6.24 % | 6.40 % | | Average Rate - Total interest-bearing liabilities | 2.30 % | 2.81 % | - Net interest income increased by $5.665 million (7.9%) year-over-year[7] - Net interest margin improved by 0.16 percentage points year-over-year, reaching 4.65%[7] - The average rate on total interest-earning assets decreased from 6.40% to 6.24% year-over-year, while the cost of average interest-bearing liabilities decreased from 2.81% to 2.30% year-over-year[7] Income Statement Data Republic Bancorp's Q3 2025 income statement shows a slight quarter-over-quarter net income decrease but a significant year-over-year increase, driven by improved net interest income and year-to-date noninterest income growth | Metric (in thousands) | Three Months Ended Sep. 30, 2025 | Three Months Ended Jun. 30, 2025 | Three Months Ended Sep. 30, 2024 | Nine Months Ended Sep. 30, 2025 | Nine Months Ended Sep. 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | Total interest income | $103,239 | $102,203 | $101,546 | $335,280 | $329,878 | | Total interest expense | $26,269 | $26,001 | $30,241 | $79,420 | $93,118 | | Net interest income | $76,970 | $76,202 | $71,305 | $255,860 | $236,760 | | Total noninterest income | $16,568 | $17,644 | $16,813 | $67,366 | $58,532 | | Total noninterest expense | $53,753 | $51,633 | $48,609 | $163,594 | $149,214 | | Net income | $29,744 | $31,484 | $26,543 | $108,496 | $82,355 | - Net income for Q3 2025 was $29.744 million, a decrease from $31.484 million in Q2 2025, but an increase from $26.543 million in Q3 2024[10] - Year-to-date net income for Sep 30, 2025, was $108.496 million, a significant increase from $82.355 million for the same period in 2024[10] - Provision for expected credit loss expense decreased significantly year-to-date, from $41.425 million in 2024 to $21.518 million in 2025[10] Selected Data and Ratios Republic Bancorp's selected data and ratios for Q3 2025 indicate improved profitability and capital adequacy year-over-year, with higher book value per share and return on average assets, despite a slight increase in the efficiency ratio quarter-over-quarter Per Share Data Book value per share and tangible book value per share continued to increase, reflecting growth in stockholders' equity, while basic and diluted EPS for Class A Common Stock showed a decrease quarter-over-quarter but a strong increase year-to-date | Metric | Sep. 30, 2025 | Jun. 30, 2025 | Sep. 30, 2024 | Sep. 30, 2025 (YTD) | Sep. 30, 2024 (YTD) | | :-------------------------- | :------------ | :------------ | :------------ | :------------------ | :------------------ | | Book value per share | $55.51 | $54.29 | $50.39 | $55.51 | $50.39 | | Tangible book value per share | $53.01 | $51.78 | $47.84 | $53.01 | $47.84 | | Basic EPS - Class A Common Stock | $1.53 | $1.62 | $1.37 | $5.57 | $4.25 | | Diluted EPS - Class A Common Stock | $1.52 | $1.61 | $1.37 | $5.55 | $4.24 | | Cash dividends declared per Class A Common share | $0.451 | $0.451 | $0.407 | $1.353 | $1.221 | - Book value per share increased by $1.22 (2.25%) quarter-over-quarter and $5.12 (10.16%) year-over-year[11] - Basic EPS for Class A Common Stock decreased from $1.62 in Q2 2025 to $1.53 in Q3 2025, but the year-to-date figure increased from $4.25 in 2024 to $5.57 in 2025[11] Performance Ratios Key performance ratios show an improvement in profitability metrics year-over-year, with Return on Average Assets and Return on Average Equity increasing, while the efficiency ratio slightly increased quarter-over-quarter but improved year-to-date | Metric | Sep. 30, 2025 | Jun. 30, 2025 | Sep. 30, 2024 | Sep. 30, 2025 (YTD) | Sep. 30, 2024 (YTD) | | :----------------------------------- | :------------ | :------------ | :------------ | :------------------ | :------------------ | | Return on average assets | 1.69 % | 1.79 % | 1.58 % | 2.03 % | 1.60 % | | Return on average equity | 10.91 % | 11.96 % | 10.88 % | 13.77 % | 11.53 % | | Efficiency ratio | 57.4 % | 55.0 % | 55.2 % | 49.7 % | 50.5 % | | Net interest margin - Total Company | 4.65 % | 4.61 % | 4.49 % | 5.18 % | 4.92 % | - Return on average assets increased from 1.58% in Q3 2024 to 1.69% in Q3 2025, and year-to-date from 1.60% to 2.03%[11] - The efficiency ratio for Q3 2025 was 57.4%, an increase from 55.0% in Q2 2025, but the year-to-date efficiency ratio improved from 50.5% in 2024 to 49.7% in 2025[11] Other Information The company maintained a stable number of full-time equivalent employees (FTEs) and banking centers, indicating consistent operational infrastructure | Metric | Sep. 30, 2025 | Jun. 30, 2025 | Sep. 30, 2024 | | :-------------------------- | :------------ | :------------ | :------------ | | End of period FTEs - Total Company | 978 | 974 | 992 | | Number of full-service banking centers | 47 | 47 | 47 | - Total Company FTEs slightly increased quarter-over-quarter from 974 to 978, but decreased from 992 year-over-year[11] Loan Composition and Allowance for Credit Losses on Loans Republic Bancorp's loan portfolio shows a slight decrease in total loans quarter-over-quarter, primarily driven by a reduction in Warehouse lines of credit and Republic Processing Group loans, while the Allowance for Credit Losses on Loans also decreased Loan Composition Traditional Banking loans remained relatively stable, while Warehouse lines of credit decreased, and Republic Processing Group loans saw a significant reduction, particularly in Tax Refund Solutions, compared to previous quarters | Loan Category (in thousands) | Sep. 30, 2025 | Jun. 30, 2025 | Sep. 30, 2024 | | :--------------------------- | :------------ | :------------ | :------------ | | Total Traditional Banking | $4,558,306 | $4,582,152 | $4,566,896 | | Warehouse lines of credit | $609,826 | $671,773 | $595,163 | | Total Core Banking | $5,168,132 | $5,253,925 | $5,162,059 | | Total Republic Processing Group | $113,242 | $119,095 | $134,858 | | Total Loans - Total Company | $5,281,374 | $5,373,020 | $5,296,917 | - Total loans decreased by $91.6 million (1.7%) quarter-over-quarter and by $15.5 million (0.3%) year-over-year[12] - Warehouse lines of credit decreased by $61.9 million (9.2%) quarter-over-quarter[12] Allowance for Credit Losses on Loans The total allowance for credit losses decreased quarter-over-quarter and year-over-year, with the allowance to total loans ratio for the Total Company remaining relatively stable, while the Tax Refund Solutions segment showed significant fluctuations | Metric (in thousands) | Sep. 30, 2025 | Jun. 30, 2025 | Sep. 30, 2024 | | :-------------------- | :------------ | :------------ | :------------ | | Total Allowance - Total Company | $79,865 | $81,760 | $82,158 | | Allowance to Total Loans - Total Company | 1.51 % | 1.52 % | 1.55 % | | Allowance to Total Loans - Tax Refund Solutions | 0.34 % | — % | 0.33 % | | Allowance to Total Loans - Republic Credit Solutions | 17.59 % | 17.67 % | 15.70 % | - Total Allowance for Credit Losses decreased by $1.895 million (2.3%) quarter-over-quarter and by $2.293 million (2.8%) year-over-year[12] - The Allowance to Total Loans for the Total Company slightly decreased from 1.52% to 1.51% quarter-over-quarter and from 1.55% year-over-year[12] Credit Quality Data and Ratios Republic Bancorp's credit quality data for Q3 2025 shows a slight increase in nonperforming assets and delinquent loans quarter-over-quarter for the Total Company, but a decrease in annualized net charge-offs year-to-date, with the Core Bank generally maintaining stable credit quality | Metric (in thousands) | Sep. 30, 2025 | Jun. 30, 2025 | Sep. 30, 2024 | Sep. 30, 2025 (YTD) | Sep. 30, 2024 (YTD) | | :-------------------- | :------------ | :------------ | :------------ | :------------------ | :------------------ | | Total nonperforming assets - Total Company | $22,955 | $22,696 | $20,757 | $22,955 | $20,757 | | Total delinquent loans - Total Company | $19,382 | $19,086 | $20,950 | $19,382 | $20,950 | | Total NCOs (recoveries) - Total Company | $3,918 | $26,366 | $4,188 | $33,631 | $41,402 | | Nonperforming loans to total loans - Total Company | 0.41 % | 0.40 % | 0.37 % | 0.41 % | 0.37 % | | Annualized NCOs (recoveries) to average loans - Total Company | 0.29 % | 1.99 % | 0.32 % | 0.84 % | 1.04 % | - Total nonperforming assets for the Total Company increased by $259 thousand (1.1%) quarter-over-quarter and by $2.198 million (10.6%) year-over-year[14] - Total delinquent loans for the Total Company increased by $296 thousand (1.6%) quarter-over-quarter but decreased by $1.568 million (7.5%) year-over-year[14] - Annualized Net Charge-offs (NCOs) to average loans for the Total Company decreased significantly year-to-date from 1.04% in 2024 to 0.84% in 2025[14] Segment Data Republic Bancorp operates through five reportable segments: Traditional Banking, Warehouse Lending, Tax Refund Solutions, Republic Payment Solutions, and Republic Credit Solutions, with performance evaluated based on income before tax expense Reportable Segments Overview The company's segments are categorized into Core Banking and Republic Processing Group, each with distinct operations and primary revenue drivers - Core Banking includes Traditional Banking (traditional products, net interest income) and Warehouse Lending (short-term revolving credit, net interest income)[18] - Republic Processing Group includes Tax Refund Solutions (tax-related credit, net interest income and net refund transfer fees), Republic Payment Solutions (general-purpose reloadable cards, net interest income and program fees), and Republic Credit Solutions (consumer credit products, net interest income and program fees)[18] - Management considers Traditional Banking and Warehouse Lending as 'Core Bank' operations, while Tax Refund Solutions, Republic Payment Solutions, and Republic Credit Solutions constitute 'Republic Processing Group' operations[16] Segment Performance - Three Months Ended September 30, 2025 For Q3 2025, Core Banking contributed the majority of net interest income and income before tax, with Republic Credit Solutions also showing significant contributions within the Republic Processing Group | Segment (in thousands) | Net interest income | Provision for expected credit loss expense | Income before income tax expense | Net income | Net-revenue concentration | | :--------------------- | :------------------ | :----------------------------------------- | :------------------------------- | :--------- | :------------------------ | | Traditional Banking | $57,424 | $(325) | $22,057 | $17,466 | 72 % | | Warehouse Lending | $3,805 | $(154) | $3,035 | $2,351 | 4 % | | Tax Refund Solutions | $280 | $(1,467) | $554 | $459 | 2 % | | Republic Payment Solutions | $3,193 | — | $2,870 | $2,246 | 4 % | | Republic Credit Solutions | $12,268 | $3,969 | $9,246 | $7,222 | 18 % | | Total Company | $76,970 | $2,023 | $37,762 | $29,744 | 100 % | - Core Banking segments (Traditional Banking and Warehouse Lending) generated $61.229 million in net interest income and $25.092 million in income before income tax expense[20] - Republic Credit Solutions was the largest contributor within the Republic Processing Group, with $12.268 million in net interest income and $9.246 million in income before income tax expense[20] Segment Performance - Nine Months Ended September 30, 2025 For the nine months ended September 30, 2025, Core Banking remained the dominant segment, while Tax Refund Solutions and Republic Credit Solutions significantly contributed to overall company performance within the Republic Processing Group | Segment (in thousands) | Net interest income | Provision for expected credit loss expense | Income before income tax expense | Net income | Net-revenue concentration | | :--------------------- | :------------------ | :----------------------------------------- | :------------------------------- | :--------- | :------------------------ | | Traditional Banking | $167,125 | $(577) | $63,281 | $50,034 | 63 % | | Warehouse Lending | $10,382 | $148 | $7,530 | $5,833 | 3 % | | Tax Refund Solutions | $30,154 | $10,028 | $29,876 | $23,382 | 15 % | | Republic Payment Solutions | $10,750 | — | $9,691 | $7,582 | 4 % | | Republic Credit Solutions | $37,449 | $11,919 | $27,736 | $21,665 | 15 % | | Total Company | $255,860 | $21,518 | $138,114 | $108,496 | 100 % | - Core Banking segments contributed $177.507 million to net interest income and $70.811 million to income before income tax expense for the nine-month period[22] - Tax Refund Solutions showed a significant net interest income of $30.154 million and income before tax of $29.876 million, with a net-revenue concentration of 15%[22] Footnotes The footnotes provide crucial details on loan fee income, the nature of provision for credit loss expense, the treatment of mortgage and consumer loans held for sale, and reconciliations of non-GAAP financial measures Loan Fee Income by Segment Loan fee income significantly impacts interest income and margins, with Republic Processing Group segments, particularly RCS and TRS, generating a substantial portion of total loan fees | Segment (in thousands) | Sep. 30, 2025 (QTD) | Sep. 30, 2024 (QTD) | Sep. 30, 2025 (YTD) | Sep. 30, 2024 (YTD) | | :--------------------- | :------------------ | :------------------ | :------------------ | :------------------ | | Traditional Banking | $1,393 | $1,518 | $4,051 | $4,165 | | Warehouse Lending | $364 | $392 | $1,043 | $977 | | TRS | $17 | $42 | $33,717 | $36,669 | | RCS | $12,123 | $12,935 | $36,794 | $35,579 | | Total loan fees - Total Company | $13,897 | $14,887 | $75,605 | $77,390 | - Total loan fees for the Total Company decreased by $990 thousand (6.6%) quarter-over-quarter and by $1.785 million (2.3%) year-to-date[23] - RCS consistently generated the largest portion of loan fees within the RPG segment, contributing $12.123 million in Q3 2025[23] Mortgage and Consumer Loans Held for Sale The company originates both mortgage and consumer loans with the intent to sell, primarily through the Traditional Banking and RCS segments, with net gains on sale contributing to noninterest income | Metric (in thousands) | Sep. 30, 2025 (QTD) | Sep. 30, 2024 (QTD) | Sep. 30, 2025 (YTD) | Sep. 30, 2024 (YTD) | | :-------------------- | :------------------ | :------------------ | :------------------ | :------------------ | | Mortgage Loans Held for Sale - Originations | $59,494 | $57,142 | $152,515 | $136,894 | | Mortgage Loans Held for Sale - Net gain on sale | $1,710 | $1,413 | $4,604 | $2,430 | | Consumer Loans Held for Sale - Originations | $271,718 | $350,413 | $859,496 | $940,901 | | Consumer Loans Held for Sale - Net gain on sale | $4,106 | $4,177 | $11,206 | $11,221 | - Mortgage loan originations held for sale increased by $2.352 million (4.1%) quarter-over-quarter and by $15.621 million (11.4%) year-to-date[25] - Consumer loan originations held for sale decreased by $49.409 million (15.4%) quarter-over-quarter and by $81.405 million (8.7%) year-to-date[25] Reconciliation of GAAP to Non-GAAP Measures The company provides reconciliations for non-GAAP measures like tangible stockholders' equity and adjusted efficiency ratio, offering a clearer view of capital adequacy and operational efficiency | Metric (in thousands) | Sep. 30, 2025 | Jun. 30, 2025 | Sep. 30, 2024 | | :-------------------- | :------------ | :------------ | :------------ | | Total stockholders' equity - GAAP | $1,084,520 | $1,060,106 | $979,705 | | Tangible stockholders' equity - Non-GAAP | $1,035,569 | $1,011,011 | $930,065 | | Book value per share - GAAP | $55.51 | $54.29 | $50.39 | | Tangible book value per share - Non-GAAP | $53.01 | $51.78 | $47.84 | - Tangible stockholders' equity increased by $24.558 million (2.4%) quarter-over-quarter and by $105.504 million (11.3%) year-over-year[28] | Metric | Sep. 30, 2025 (QTD) | Sep. 30, 2024 (QTD) | Sep. 30, 2025 (YTD) | Sep. 30, 2024 (YTD) | | :-------------------------- | :------------------ | :------------------ | :------------------ | :------------------ | | Efficiency Ratio - GAAP-derived | 57.5 % | 55.2 % | 50.6 % | 50.5 % | | Adjusted Efficiency Ratio - Non-GAAP | 57.4 % | 55.2 % | 49.7 % | 50.5 % | - The Adjusted Efficiency Ratio for Q3 2025 was 57.4%, an increase from 55.2% in Q3 2024, but the year-to-date ratio improved from 50.5% in 2024 to 49.7% in 2025[29]