The company had reached an agreement with the Federal Deposit Insurance Corp. that this would be the last year RALs would be offered and it was the last bank left providing those loans and had cut back on the amount of money available for loans. However, despite lower RAL volume, the company saw an improvement on the estimated loss rate for the loans. That rate was 1.4 percent of those generated as of March 31, compared to 1.58 percent for the same period a year earlier. Republic said that resulted from changes in the underwriting model. This was the first year the Internal Revenue Service did not provide the debt indicator and the FDIC had charged that Republic's continuing to offer RALs without that information represented unsound banking practices.

 

The TRS segment had a $5.7 million reduction in non-interest expenses. That included a $3.1-million decline in charitable contribution expense which totaled $1.8 million for the quarter compared to $4.9 million a year earlier. This year the company made a $2.5-million contribution to the Republic Bank Foundation, compared to a $5 million contribution in the same quarter last year. The contributions are allocated across the business operating segments utilizing a formula based on pre-tax profits.