U.S. regulators seize troubled lender Republic First, sell it to Fulton Bank

(Reuters) -- U.S. regulators have seized Republic First Bancorp and agreed to sell it to Fulton Bank, underscoring the challenges facing regional banks a year after the collapse of three peers.

Philadelphia-based Republic First, which had abandoned funding talks with a group of investors, was seized by the Pennsylvania Department of Banking and Securities.

The Federal Deposit Insurance Corp (FDIC), appointed as a receiver, said on Friday Fulton Bank, a unit of Fulton Financial Corp FULT.O, will assume substantially all deposits and purchase all the assets of Republic Bank, which is the operating name for Republic First, to "protect depositors".

Republic Bank had about $6 billion in total assets and $4 billion in total deposits, as of Jan. 31, 2024. The FDIC estimated the cost of the failure to its fund will be $667 million.

Apart from deposits, Republic also had borrowings and other liabilities of approximately $1.3 billion, Fulton said in a statement.

Fulton said the deal almost doubles its presence in the Philadelphia market with combined company deposits of approximately $8.6 billion.

"With this transaction, we are excited to double our presence across the region," said Fulton Chairman and CEO Curt Myers in a statement.

Republic Bank's 32 branches in New Jersey, Pennsylvania and New York will reopen as branches of Fulton Bank on Saturday or on Monday during business hours.

The decision marks the latest U.S. regional bank failure following the unexpected collapses of three lenders - Silicon Valley and Signature in March 2023 and First Republic in May.

Republic Bank had struck a deal with an investor group that included veteran businessman George Norcross and high-profile attorney Philip Norcross late last year, but the effort