(Reuters) -U.S. regulators have seized Republic First Bancorp and agreed to sell it to another lender, the Federal Deposit Insurance Corp said on Friday.
The FDIC has been appointed as receiver and has entered into an agreement with Fulton Bank, National Association of Lancaster, Pennsylvania to assume substantially all of the deposits and purchase substantially all of the assets of Republic Bank.
The decision marks the latest regional bank failure following the unexpected collapses of three lenders – Silicon Valley and Signature in March 2023 and First Republic in May.
The Philadelphia-based lender struck a deal with an investor group that included veteran businessman George Norcross, high-profile attorney Philip Norcross late last year, but that was terminated in February.
After that deal collapsed, the FDIC resumed efforts to seize and sell the bank, according to the Wall Street Journal, which first reported the news.
Republic Bank had about $6 billion in total assets and $4 billion in total deposits, as of Jan. 31, 2024. The FDIC estimates that the cost to the Deposit Insurance Fund related to the failure of Republic Bank will be $667 million.
The regional lender was reeling with higher costs and inability to improve profitability that prompted it to cut jobs and exit its mortgage origination business in early 2023.
The bank’s stock price has tumbled from just over $2 at the start of the year to about 1 cent on Friday, leaving it with a market capitalization below $2 million.
Its shares were delisted from the Nasdaq in August and now trade over the counter.
(Reporting by Nathan Gomes in Bengaluru; Editing by Shilpi Majumdar and Sriraj Kalluvila)
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