Republic Bancorp Reports 12% Increase in Net Income to $101.4 Million for 2024

Republic Bancorp, Inc. (Republic), a Kentucky-based financial holding company, reported a net income of $101.4 million for the year ended December 31, 2024, a 12% increase compared to $90.4 million in 2023. Diluted earnings per Class A Common Share rose to $5.21 in 2024 from $4.62 in 2023, reflecting a 13% increase. Return on average assets (ROA) was 1.47% in 2024, and return on average equity (ROE) was 10.50%. The company's total assets reached $6.8 billion, with total deposits at $5.2 billion and total stockholders' equity at $992 million. As of December 31, 2024, Republic operated 47 full-service banking centers across Kentucky, Indiana, Florida, Ohio, and Tennessee.

Significant changes compared to the previous fiscal year included a 13% increase in income before income tax expense, reaching $127.7 million in 2024. Total company net interest income increased by $23.4 million to $312.2 million in 2024, while the net interest margin decreased slightly to 4.85% from 4.91% in 2023. Noninterest income increased by $1.2 million to $72.65 million, and noninterest expense rose by $3.3 million to $202.7 million. The provision for expected credit loss expense increased to $54.4 million in 2024 from $47.6 million in 2023. The company dissolved its wholly-owned insurance subsidiary, Republic Insurance Services, Inc., during the fourth quarter of 2023. In March 2024, the company reclassified its mortgage banking operations into the Traditional Banking segment due to the immateriality of this division.

Strategic developments included the continued implementation of a stricter pricing strategy across all loan types in response to the inverted yield curve and elevated funding costs. The company also revised its agreement with its largest third-party marketer-servicer for Refund Advances and Early Season Refund Advances for the 2025 tax season, securing a loss cap guarantee for Early Season Refund Advances and increased fee income. The company also noted its acquisition strategy to selectively grow its franchise. As of December 31, 2024, Republic employed 989 full-time equivalent employees.

Key operational developments included a decrease in total Traditional Bank loans by $49 million (1%) and an increase in total Traditional Bank deposits by $209 million to $4.6 billion. Average committed Warehouse lines of credit decreased to $938 million from $1.0 billion in 2023, while average Warehouse line usage increased to 50% from 42%. Tax Refund Solutions originated $139 million in Early Season Refund Advances in the fourth quarter of 2024, compared to $103 million in the fourth quarter of 2023. Total nonperforming loans to total loans for the Traditional Banking segment was 0.50% as of December 31, 2024, and for the Republic Credit Solutions segment, it was 0.11%.

Republic's outlook and forward-looking statements highlighted the potential impact of inflation and interest rate fluctuations on its operations and profitability. The company acknowledged risks related to interest rate sensitivity, credit losses, operational challenges, regulatory changes, and the success of its acquisition strategy. The company also noted that future results would depend on attracting and retaining key personnel and managing cybersecurity risks. The company's ability to pay future dividends was also noted as dependent on several factors, including the Bank's financial performance and regulatory restrictions.