Republic Bancorp's Net Income Jumps 31.7% on Lower Credit Losses

TL;DR

**Republic Bancorp is crushing it, with net income up 31.7% and credit losses slashed, making RBCAA a solid buy.**

AI Summary

REPUBLIC BANCORP INC /KY/ reported a strong financial performance for the nine months ended September 30, 2025, with net income increasing by 31.7% to $108.496 million, up from $82.355 million in the prior year. Net interest income also saw a significant rise of 8.1% to $255.860 million, compared to $236.760 million in the same period of 2024. This growth was supported by a substantial decrease in the provision for expected credit loss expense on loans, which fell by 48.1% from $41.425 million in 2024 to $21.518 million in 2025. Total assets grew to $7.014 billion as of September 30, 2025, from $6.846 billion at December 31, 2024, driven by an increase in available-for-sale debt securities to $843.171 million from $584.155 million. Deposits also increased to $5.338 billion from $5.210 billion. Diluted EPS for Class A Common Stock rose to $5.55 for the nine months ended September 30, 2025, from $4.24 in the prior year, reflecting enhanced profitability and shareholder value.

Why It Matters

This strong performance, particularly the significant increase in net income and reduction in credit loss provisions, signals robust financial health for Republic Bancorp. For investors, this indicates improved profitability and potentially higher returns, making RBCAA a more attractive investment in a competitive banking landscape. Employees benefit from a stable and growing company, while customers can be assured of the bank's resilience. The reduced credit loss provision suggests effective risk management, which could set a positive precedent for other regional banks facing similar economic pressures, potentially influencing broader market sentiment towards the banking sector.

Risk Assessment

Risk Level: low — The risk level is low due to a significant 48.1% decrease in the provision for expected credit loss expense on loans, from $41.425 million in 2024 to $21.518 million in 2025. Additionally, the company's net income increased by 31.7% to $108.496 million, demonstrating strong financial performance and resilience.

Analyst Insight

Investors should consider increasing their exposure to RBCAA, given the substantial growth in net income and the significant reduction in credit loss provisions. The improved financial health and efficient risk management suggest continued positive performance, making it a compelling long-term hold.

Financial Highlights

debt To Equity

5.47

revenue

$373.088M

operating Margin

N/A

total Assets

$7.014B

total Debt

$5.930B

net Income

$108.496M

eps

$5.55

gross Margin

N/A

cash Position

$484.238M

revenue Growth

2.05%

Revenue Breakdown

Key Numbers

• $108.496M — Net Income (Increased 31.7% for the nine months ended September 30, 2025, from $82.355M in 2024.)
• $21.518M — Provision for Expected Credit Loss Expense on Loans (Decreased 48.1% for the nine months ended September 30, 2025, from $41.425M in 2024.)
• $255.860M — Net Interest Income (Increased 8.1% for the nine months ended September 30, 2025, from $236.760M in 2024.)
• $5.55 — Diluted EPS (Class A Common Stock) (Increased for the nine months ended September 30, 2025, from $4.24 in 2024.)
• $7.014B — Total Assets (Increased from $6.846B at December 31, 2024, to September 30, 2025.)
• $5.338B — Total Deposits (Increased from $5.210B at December 31, 2024, to September 30, 2025.)
• $843.171M — Available-for-sale debt securities (Increased from $584.155M at December 31, 2024, to September 30, 2025.)

Key Players & Entities

• REPUBLIC BANCORP INC /KY/ (company) — Registrant
• Republic Bank & Trust Company (company) — Wholly owned subsidiary
• Nasdaq Stock Market, LLC (regulator) — Exchange for Class A Common Stock
• Securities and Exchange Commission (regulator) — Filing oversight
• $108,496 (dollar_amount) — Net income for nine months ended September 30, 2025
• $82,355 (dollar_amount) — Net income for nine months ended September 30, 2024
• $21,518 (dollar_amount) — Provision for expected credit loss expense on loans for nine months ended September 30, 2025
• $41,425 (dollar_amount) — Provision for expected credit loss expense on loans for nine months ended September 30, 2024
• $5.55 (dollar_amount) — Diluted EPS for Class A Common Stock for nine months ended September 30, 2025
• $4.24 (dollar_amount) — Diluted EPS for Class A Common Stock for nine months ended September 30, 2024

FAQ

Industry Context

Republic Bancorp operates within the highly competitive U.S. banking sector, characterized by evolving regulatory landscapes and increasing digital adoption. Banks are focusing on managing interest rate sensitivity, enhancing digital customer experiences, and navigating economic uncertainties. The industry is seeing consolidation and a continued emphasis on risk management and capital adequacy.

Regulatory Implications

As a financial institution, Republic Bancorp is subject to stringent regulations from federal and state authorities, including the Federal Reserve, OCC, and state banking departments. Compliance with capital requirements, lending standards, and consumer protection laws is critical. Changes in regulatory policy, such as interest rate risk management or capital adequacy rules, could impact profitability and operations.

What Investors Should Do

1. Monitor net interest margin trends
2. Analyze the decrease in provision for credit losses
3. Evaluate the growth in available-for-sale debt securities

Glossary

Available-for-sale debt securities

Investments in debt securities that are not classified as held-to-maturity or trading securities. They are reported at fair value, with unrealized gains and losses included in other comprehensive income. (A significant increase in these securities from $584.155M to $843.171M contributed to asset growth.)

Provision for Expected Credit Loss Expense on Loans

An expense recognized by lenders to account for potential losses on loans due to credit risk. It is an estimate based on historical data, current conditions, and reasonable and supportable forecasts. (A substantial decrease of 48.1% in this provision significantly boosted net income.)

Net Interest Income

The difference between the interest income generated by a bank's interest-earning assets (like loans and securities) and the interest expense paid on its interest-bearing liabilities (like deposits and borrowings). (This key driver of profitability increased by 8.1% to $255.860M, indicating improved net interest margin or loan/deposit growth.)

Diluted EPS (Class A Common Stock)

Earnings per share calculated by dividing net income by the total number of diluted common shares outstanding. Diluted EPS includes the effect of all dilutive potential common shares, such as stock options and convertible securities. (The increase to $5.55 from $4.24 reflects improved profitability on a per-share basis for Class A shareholders.)

Allowance for credit losses

A contra-asset account that reduces the carrying amount of loans to their estimated net realizable value. It represents the cumulative provision for expected credit losses. (The decrease in the allowance from $91.978M to $79.865M aligns with the reduced provision for credit losses.)

Year-Over-Year Comparison

Republic Bancorp Inc. /KY/ has demonstrated robust performance compared to the prior year's nine-month period. Total assets grew to $7.014 billion from $6.846 billion, primarily driven by a significant increase in available-for-sale debt securities. Net income surged by 31.7% to $108.496 million, bolstered by an 8.1% rise in net interest income and a substantial 48.1% reduction in the provision for credit losses. Diluted EPS for Class A Common Stock also saw a healthy increase to $5.55 from $4.24, indicating enhanced shareholder value.

Filing Documents

• rbcaa-20250930x10q.htm (10-Q) — 15211KB
• rbcaa-20250930xex31d1.htm (EX-31.1) — 13KB
• rbcaa-20250930xex31d2.htm (EX-31.2) — 13KB
• rbcaa-20250930xex32.htm (EX-32) — 10KB
• rbcaa-20250930x10q002.jpg (GRAPHIC) — 9KB
• 0001104659-25-107626.txt ( ) — 60645KB
• rbcaa-20250930.xsd (EX-101.SCH) — 124KB
• rbcaa-20250930_cal.xml (EX-101.CAL) — 186KB
• rbcaa-20250930_def.xml (EX-101.DEF) — 617KB
• rbcaa-20250930_lab.xml (EX-101.LAB) — 978KB
• rbcaa-20250930_pre.xml (EX-101.PRE) — 865KB
• rbcaa-20250930x10q_htm.xml (XML) — 20511KB

— FINANCIAL INFORMATION

PART I — FINANCIAL INFORMATION Item 1.

Financial Statements

Financial Statements. 4 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations. 61 Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk. 113 Item 4.

Controls and Procedures

Controls and Procedures. 113

— OTHER INFORMATION

PART II — OTHER INFORMATION Item 1. Legal Proceedings. 113 Item 1A. Risk Factors. 113 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. 114 Item 5. Other Information. 114 Item 6. Exhibits. 115

SIGNATURES

SIGNATURES 116 2 Table of Contents GLOSSARY OF TERMS The terms identified in alphabetical order below are used throughout this Form 10-Q. You may find it helpful to refer to this page as you read this report. Term Definition 2024 Tax Season December 2023 through February 2024 2025 Tax Season December 2024 through February 2025 ACH Automated Clearing House ACL Allowance for Credit Losses ACLC Allowance for Credit Losses on Off-Balance Sheet Credit Exposures ACLL Allowance for Credit Losses on Loans AFS Available for Sale AOCI Accumulated Other Comprehensive Income ARM Adjustable Rate Mortgage ASC Accounting Standards Codification ASU Accounting Standards Update Basic EPS Basic earnings per Class A Common Share BOLI Bank Owned Life Insurance BPO Brokered Price Opinion C&LD Construction and Land Development C&I Commercial and Industrial CCAD Commercial Credit Administration Department CD Certificate of Deposit CDI Core Deposit Intangible CECL Current Expected Credit Losses CMO Collateralized Mortgage Obligation CODM Chief Operating Decision Maker Core Bank The Traditional Banking and Warehouse Lending reportable segments of the Company CRE Commercial Real Estate DDA Demand Deposit Account Diluted EPS Diluted earnings per Class A Common Share DTA Deferred Tax Asset EPS Earnings Per Share ERA Early Season Refund Advance ESPP Employee Stock Purchase Plan FDIC Federal Deposit Insurance Corporation FFTR Federal Funds Target Rate FHLB Federal Home Loan Bank FHLMC Federal Home Loan Mortgage Corporation FICO Fair Isaac Corporation FNMA Federal National Mortgage Association FOMC Federal Open Market Committee FRB Federal Reserve Bank FTP Funds Transfer Pricing GAAP Generally Accepted Accounting Principles in the United States HEAL Home Equity Amortizing Loan HELOC Home Equity Line of Credit HFS Held for Sale HTM Held to Maturity LOC Line of Credit LOC I RCS product introdu

— FINANCIAL INFORMATIO N

PART I — FINANCIAL INFORMATIO N

Financial Statements

Item 1. Financial Statements. CONSOLIDATED BALANCE SHEETS ( UNAUDITED ) ( in thousands, except share data) September 30, December 31, 2025 2024 ASSETS Cash and cash equivalents $ 484,238 $ 432,151 Available-for-sale debt securities, at fair value (amortized cost of $ 849,734 in 2025 and $ 602,493 in 2024) 843,171 584,155 Held-to-maturity debt securities (fair value of $ 5,087 in 2025 and $ 10,735 in 2024) 5,110 10,778 Equity securities with readily determinable fair value 945 693 Mortgage loans held for sale, at fair value 15,338 8,312 Consumer loans held for sale, at fair value 8,444 5,443 Consumer loans held for sale, at the lower of cost or fair value 16,424 18,632 Loans 5,281,374 5,439,466 Allowance for credit losses ( 79,865 ) ( 91,978 ) Loans, net 5,201,509 5,347,488 Federal Home Loan Bank stock, at cost 25,849 24,478 Premises and equipment, net 37,884 32,309 Right-of-use assets 32,804 36,182 Goodwill 40,516 40,516 Other real estate owned 1,246 1,160 Bank owned life insurance 109,773 107,125 Other assets and accrued interest receivable 191,668 197,245 TOTAL ASSETS $ 7,014,919 $ 6,846,667 LIABILITIES Deposits: Noninterest-bearing $ 1,239,023 $ 1,207,764 Interest-bearing 4,099,322 4,002,782 Total deposits 5,338,345 5,210,546 Securities sold under agreements to repurchase and other short-term borrowings 74,522 103,318 Operating lease liabilities 33,833 37,121 Federal Home Loan Bank advances 375,000 395,000 Other liabilities and accrued interest payable 108,699 108,653 Total liabilities 5,930,399 5,854,638 Commitments and contingent liabilities (Footnote 8) — — STOCKHOLDERS' EQUITY Preferred stock, no par value — — Class A Common Stock, no par value, 30,000,000 shares authorized, 17,387,179 shares (2025) and 17,297,878 shares (2024) issued and outstanding; Class B Com

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS –SEPTEMBER 30, 2025 and 2024 AND DECEMBER 31, 2024 (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS –SEPTEMBER 30, 2025 and 2024 AND DECEMBER 31, 2024 (UNAUDITED) 1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation — The consolidated financial statements include the accounts of Republic Bancorp, Inc. (the "Parent Company") and its wholly owned subsidiary, Republic Bank & Trust Company. As used in this filing, the terms "Republic," the "Company," "we," "our," and "us" refer to Republic Bancorp, Inc., and, where the context requires, Republic Bancorp, Inc., and its subsidiary. The term the "Bank" refers to the Company's subsidiary bank, Republic Bank & Trust Company, as well as, its wholly owned subsidiary, RBT Insurance Agency LLC. All significant intercompany balances and transactions are eliminated in consolidation. Republic is a financial holding company headquartered in Louisville, Kentucky. The Bank is a Kentucky-based, state-chartered non-member financial institution that provides both traditional and non-traditional banking products through five reportable segments using a multitude of delivery channels. While the Bank operates primarily in its geographical market footprint where it has physical locations, its non-brick-and-mortar delivery channels allow it to reach clients across the U.S. The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, the financial statements do not include all the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for fair presentation have been included. Operating results for the three and nine months ended September 30, 2025, are not necessarily indicative of the results that may be expected for the full year ending December 31,

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