will include a fictitious amount for a “force reduction” in its lending and credit departments.
Philadelphia-based Republic First Bancorp Inc., the parent company of Republic First Bank, announced on Friday that it would no longer be starting mortgages.
The parent company of the bank said that it “will exit its legacy mortgage origination business” in a filing with the Securities and Exchange Commission. The bank is known by the name Republic Bank.
According to the publication, the bank would “continue to support local communities through various Community Reinvestment Act initiatives,” in line with its core business lines.
“A long-term jumbo mortgage product, priced at aggressive rates” was the bank’s primary offering when it first started out. But according to the bank, this was no longer consistent with its preference for asset classes that offered “shorter-duration and better risk-adjusted return.”
The statement went on, “The company’s approach to increasing profitability and allocating more resources to core business lines is no longer consistent with the high-cost nature of a jumbo mortgage origination platform.”
Along with restructuring its commercial lending operations in New York City, the bank declared that it had made “commensurate reductions in force” in its lending and credit teams. There was no mention of the quantity of axed posts.
By doing this, Republic Bank will be able to focus on its strong commercial ties in and around its major Philadelphia metropolitan area market, serving local clients with both domestic and foreign enterprises, the bank said in the report.
Republic First originated $276.3 million in loans in the 12-month period that ended in April 2023, of which $245.6 million were conventional loans, according to Modex. A total of $207.8 million in such loans were made for the purchase of mortgages.
The changes are in accordance with the “clear strategy” that Republic First Bancorp president and CEO Thomas X. Geisel declared at the time, which focused on focusing on core business lines in key locations.
The changes “represent important steps in that direction,” he said in closing. “We announced that we would be implementing significant business realignment and efficiency initiatives to grow profitability, enable us to better serve our customers, and create value for shareholders and all stakeholders in our recent first quarter 2023 earnings report,” the speaker stated.
He continued, saying, “Despite the fact that these were difficult choices because of the inherent reduction in force needed, we firmly believe they are in the best interests of the company and will allow us to build a strong foundation for the future.”
“I want to convey my sincere gratitude to our diligent employees who are the cornerstone of our success and will always be,” he continued. I’m excited about the opportunities we have to build an even greater Republic Bank. We commit to keeping the market and our shareholders informed about business developments on a frequent basis while we move quickly to execute our plan.