Louisville-based Republic Bancorp, parent company of Republic Bank & Trust, on Thursday announced a 25 percent increase in earnings during 2009 compared to a year earlier, driven by growth in its tax-refund loan program.
Republic reported net income of $42.1 million for the year, up from $33.7 million in 2008. Earnings per share increased to $2.02 compared to $1.62 in the same period a year earlier.
Net income in the fourth quarter was $3.8 million, up from $604,000 in the same period a year earlier.
The company overall did see its provision for loan losses more than double during the year from $16.2 million in 2008 to $34 million in 2009. It was on the rise at an even greater rate in the fourth quarter as it rose from $1.8 million in that period in 2008 to $5.2 million last year.
The growth for the company overall was driven by Republic's Tax Refund Solutions business, which saw net interest income explode from $18.2 million in 2008 to $52.7 million this year. The segment's provision for loan losses increased, too, from $8.1 million in 2008 to $18.1 million in 2009, but the overall rise in net interest income outpaced the loan loss provision rise.
The segment saw its overall net income increase from $13.3 million in 2008 to $20 million last year. The program, administered through tax preparers nationwide, offers a loan in the amount of the tax refund, minus fees, if taxpayers sign the refund checks over to Republic.
Republic's traditional banking business saw net income decline slightly from $18.4 million in 2008 to $15.4 million in 2009.
Republic Bancorp operates 44 banking branches in primarily Kentucky, as well as Florida, Indiana and Ohio.