U.S. regulators have seized Republic First Bancorp and agreed to sell it to Fulton Bank, marking another blow to regional banks in the aftermath of the collapse of three peers last year.
Philadelphia-based Republic First, which had previously abandoned funding talks with investors, was taken over by the Pennsylvania Department of Banking and Securities. The Federal Deposit Insurance Corp (FDIC) has been appointed as a receiver and announced that Fulton Bank, a unit of Fulton Financial Corp, will assume all deposits and purchase all assets of Republic Bank to protect depositors.
With approximately $6 billion in total assets and $4 billion in total deposits, Republic Bank’s failure is estimated to cost the FDIC $667 million. Fulton Bank stated that aside from deposits, Republic also had borrowings and other liabilities totaling around $1.3 billion.
The acquisition nearly doubles Fulton Bank’s presence in the Philadelphia market, with combined company deposits reaching approximately $8.6 billion. Republic Bank’s 32 branches in New Jersey, Pennsylvania, and New York will reopen as branches of Fulton Bank in the coming days.
This latest regional bank failure follows the unexpected collapses of Silicon Valley, Signature, and First Republic last year. Republic Bank had previously struck a deal with an investor group, including George Norcross and Philip Norcross, but the agreement was terminated in February.
The bank’s struggles, including job cuts and exiting the mortgage origination business, led to a significant decline in its stock price, which now trades over the counter after being delisted from the Nasdaq. Financial advisers Piper Sandler & Co and BofA Securities, along with legal adviser Sullivan & Cromwell LLP, facilitated the sale to Fulton Bank.