First Republic Reports First Quarter 2021 Results

Revenues Increased 24% Year-Over-Year

Tangible Book Value Per Share Increased 14.5% Year-Over-Year

10% Quarterly Dividend Increase Marks 10^th Consecutive Year of Dividend Increases

SAN FRANCISCO--(BUSINESS WIRE)--First Republic Bank (NYSE: FRC) today announced financial results for the quarter ended March 31, 2021.

“First Republic is off to a very strong start in 2021, driven by strong growth in loans, deposits and wealth management assets,” said Jim Herbert, Founder, Chairman and CEO. “Our client-centric business model continues to perform very well.”

Quarterly Highlights

Financial Results

– Year-over-year:

– Revenues were $1.1 billion, up 23.8%.

– Net interest income was $938.8 million, up 24.8%.

– Net income was $334.8 million, up 53.1%.

– Diluted earnings per share of $1.79, up 49.2%.

– Tangible book value per share was $59.98, up 14.5%.

– Loan originations totaled $15.7 billion, our strongest first quarter ever.

– Net interest margin was 2.67%, compared to 2.73% for the prior quarter.

– Efficiency ratio was 63.5% for both the first quarter of 2021 and 2020.

– Increased quarterly dividend by 10% to $0.22 per share.

Continued Capital and Credit Strength

– Tier 1 leverage ratio was 8.32%.

– Nonperforming assets were at a low 11 basis points of total assets.

– Net charge-offs were only $487,000, or less than 1 basis point of average loans.

Continued Franchise Development

– Year-over-year:

– Loans totaled $118.1 billion, up 23.9%, excluding loans held for sale.

– Deposits were $127.9 billion, up 36.5%.

– Wealth management assets were $218.9 billion, up 58.8%.

– Wealth management revenues were $159.6 million, up 18.7%.

“We’re pleased with the very strong growth of revenue and earnings per share during the first quarter,” said Mike Roffler, Chief Financial Officer. “We also increased the quarterly dividend for the 10^th consecutive year and accessed the capital markets twice during the quarter, which contributed to the 25% increase in total equity year-over-year.”

Quarterly Cash Dividend of $0.22 per Share

The Bank announced an increase of $0.02 in its quarterly cash dividend to $0.22 per share of common stock, our 10^th consecutive year of quarterly dividend increases. The first quarter dividend is payable on May 13, 2021 to shareholders of record as of April 29, 2021.

Strong Asset Quality

Credit quality remains strong. Nonperforming assets were only 11 basis points of total assets at March 31, 2021. The Bank had modest net loan charge-offs of only $487,000 for the quarter.

During the first quarter, the Bank recorded a reversal of provision for credit losses of $14.6 million, which was primarily driven by a substantially improved economic outlook since year-end 2020 and the significant resumption of regular, consistent loan payments on COVID-19 loan modifications following the end of the modification period.

Continued Capital Strength and Book Value Growth

The Bank’s Tier 1 leverage ratio was 8.32% at March 31, 2021, compared to 8.14% at December 31, 2020.

During the first quarter, the Bank issued $747.5 million of 4.250% Noncumulative Perpetual Preferred Stock, which qualifies as Tier 1 capital, and redeemed all of the outstanding shares of its 5.50% Noncumulative Perpetual Preferred Stock, which totaled $150.0 million.

In addition, the Bank sold 2,012,500 new shares of common stock in an underwritten public offering, which added approximately $331.3 million to common equity.

Total common stock sold and preferred stock issued, net of preferred stock redeemed, added approximately $914.2 million of Tier 1 capital in the quarter and contributed to the 25% increase in total equity year-over-year.

The Bank has not and does not engage in common stock buybacks.

Book value per common share at March 31, 2021 was $61.26, up 14.0% from a year ago. Tangible book value per common share at March 31, 2021 was $59.98, up 14.5% from a year ago.

Continued Franchise Development

Loan Originations

Loan originations were $15.7 billion for the quarter, up 52.4% from the same quarter a year ago, primarily due to increases in single family and business lending, as well as loan originations under the Small Business Administration’s Paycheck Protection Program (“PPP”).

Single family loan originations were 44% of the total volume for the quarter and had a weighted average loan-to-value ratio of 57%. In addition, multifamily and commercial real estate loans originated were 7% of total originations, and had a weighted average loan-to-value ratio of 49%.

Loans totaled $118.1 billion at March 31, 2021, up 23.9% compared to a year ago, excluding loans held for sale, primarily due to increases in single family loans (71% of growth), business and multifamily loans, as well as PPP loans.

COVID-19 Loan Modifications Continue to Decline

Remaining loan modifications to those borrowers experiencing financial challenges as a result of COVID-19 (not classified as troubled debt restructurings) totaled $967 million, and were less than 1% of total loans as of March 31, 2021, down from a peak of approximately 4% of total loans as of June 30, 2020.

The Bank has limited loan exposure to several of the areas most directly impacted by COVID-19, such as the retail, hotel and restaurant industries, which totaled $2.5 billion as of March 31, 2021, only 2.1% of total loans. As of March 31, 2021, the Bank had modifications of these portfolios totaling $141 million, only 0.1% of total loans.

Deposit Growth

Total deposits increased to $127.9 billion, up 36.5% compared to a year ago, and had an average rate paid of 9 basis points during the quarter.

At March 31, 2021, checking deposit balances were 67.5% of total deposits.

Investments

Total investment securities at March 31, 2021 were $21.7 billion, a 17.0% increase compared to the prior quarter and a 15.4% increase compared to a year ago.

High-quality liquid assets, including eligible cash, totaled $23.3 billion at March 31, 2021, and represented 15.3% of quarterly average total assets.

Wealth Management

Total wealth management assets were $218.9 billion at March 31, 2021, up 12.6% compared to the prior quarter and up 58.8% compared to a year ago. The increases in wealth management assets were due to both net client inflow and market appreciation.

Wealth management revenues totaled $159.6 million for the quarter, up 18.7% compared to last year’s first quarter. Such revenues represented 14.1% of the Bank’s total revenues for the quarter.

Wealth management assets at March 31, 2021 included investment management assets of $90.8 billion, brokerage assets and money market mutual funds of $112.9 billion, and trust and custody assets of $15.2 billion.

Income Statement and Key Ratios

Revenue Growth

Total revenues were $1.1 billion for the quarter, up 23.8% compared to the first quarter a year ago.

Net Interest Income Growth

Net interest income was $938.8 million for the quarter, up 24.8% compared to the first quarter a year ago. The increase in net interest income resulted primarily from growth in average interest-earning assets, partially offset by a decrease in net interest margin.

Net Interest Margin

The net interest margin declined to 2.67% in the first quarter, from 2.73% in the prior quarter. The decrease was primarily due to higher average cash balances during the quarter.

Noninterest Income

Noninterest income was $195.9 million for the quarter, up 19.4% compared to the first quarter a year ago. The increase was primarily driven by higher wealth management fees and higher income from investments in life insurance.

Noninterest Expense and Efficiency Ratio

Noninterest expense was $720.4 million for the quarter, up 23.8% compared to the first quarter a year ago. The increase was primarily due to increased salaries and benefits and information systems costs from the continued investments in the expansion of the franchise, and higher professional fees.

The efficiency ratio was 63.5% for both the first quarter of 2021 and 2020.

Income Taxes

The Bank’s effective tax rate for the first quarter of 2021 was 21.9%, compared to 22.1% for the prior quarter, and 19.5% for the first quarter a year ago. The increase from a year ago was primarily the result of lower excess tax benefits from a decrease in stock option exercises by employees, and growth in pre-tax income greater than interest income on tax-exempt municipal securities.

Conference Call Details

First Republic Bank’s first quarter 2021 earnings conference call is scheduled for April 14, 2021 at 7:00 a.m. PT / 10:00 a.m. ET. To access the event by telephone, please dial [phone] and provide confirmation code 8396045 approximately 15 minutes prior to the start time (to allow time for registration). International callers should dial [phone] and provide the same confirmation code.

The call will also be broadcast live over the Internet and can be accessed in the Investor Relations section of First Republic’s website at ir.firstrepublic.com/events-calendar. To listen to the live webcast, please visit the site at least 15 minutes prior to the start time to register, download and install any necessary audio software.

For those unable to join the live presentation, a replay of the call will be available beginning April 14, 2021, at 11:00 a.m. PT / 2:00 p.m. ET, through April 21, 2021, at 8:59 p.m. PT / 11:59 p.m. ET. To access the replay, dial [phone] and use confirmation code 8396045#. International callers should dial [phone] and enter the same confirmation code. A replay of the webcast also will be available for 90 days following, accessible in the Investor Relations section of First Republic Bank’s website at ir.firstrepublic.com/events-calendar.

The Bank’s press releases are available after release in the Newsroom and Investor Relations section of First Republic Bank’s website at firstrepublic.com.

About First Republic Bank

Founded in 1985, First Republic and its subsidiaries offer private banking, private business banking and private wealth management, including investment, trust and brokerage services. First Republic specializes in delivering exceptional, relationship-based service and offers a complete line of products, including residential, commercial and personal loans, deposit services, and wealth management. Services are offered through preferred banking or wealth management offices primarily in San Francisco, Palo Alto, Los Angeles, Santa Barbara, Newport Beach and San Diego, California; Portland, Oregon; Boston, Massachusetts; Palm Beach, Florida; Greenwich, Connecticut; New York, New York; and Jackson, Wyoming. First Republic is a constituent of the S&P 500 Index and KBW Nasdaq Bank Index. For more information, visit firstrepublic.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements in this press release that are not historical facts are hereby identified as “forward-looking statements” for the purpose of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipates,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimates,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “intends” and similar words or phrases. Accordingly, these statements are only predictions and involve estimates, known and unknown risks, assumptions and uncertainties that could cause actual results to differ materially from those expressed in them.

Forward-looking statements involving such risks and uncertainties include, but are not limited to, statements regarding: projections of loans, assets, deposits, liabilities, revenues, expenses, tax liabilities, net income, capital expenditures, liquidity, dividends, capital structure, investments or other financial items; expectations regarding the banking and wealth management industries; descriptions of plans or objectives of management for future operations, products or services; forecasts of future economic conditions generally and in our market areas in particular, which may affect the ability of borrowers to repay their loans and the value of real property or other property held as collateral for such loans; our opportunities for growth and our plans for expansion (including opening new offices); expectations about the performance of any new offices; projections about the amount and the value of intangible assets, as well as amortization of recorded amounts; future provisions for credit losses on loans and debt securities, as well as for unfunded loan commitments; changes in nonperforming assets; expectations regarding the impact and duration of COVID-19; projections about future levels of loan originations or loan repayments; projections regarding costs, including the impact on our efficiency ratio; and descriptions of assumptions underlying or relating to any of the foregoing.

Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to: significant competition to attract and retain banking and wealth management customers, from both traditional and non-traditional financial services and technology companies; our ability to recruit and retain key managers, employees and board members; natural or other disasters, including earthquakes, wildfires, pandemics or acts of terrorism affecting the markets in which we operate; the negative impacts and disruptions resulting from COVID-19 on our colleagues and clients, the communities we serve and the domestic and global economy, which may have an adverse effect on our business, financial position and results of operations; interest rate risk and credit risk; our ability to maintain and follow high underwriting standards; economic and market conditions, including those affecting the valuation of our investment securities portfolio and credit losses on our loans and debt securities; real estate prices generally and in our markets; our geographic and product concentrations; demand for our products and services; developments and uncertainty related to the future use and availability of some reference rates, such as the London Interbank Offered Rate and the 11th District Monthly Weighted Average Cost of Funds Index, as well as other alternative reference rates; the regulatory environment in which we operate, our regulatory compliance and future regulatory requirements; any future changes to regulatory capital requirements; legislative and regulatory actions affecting us and the financial services industry, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), including increased compliance costs, limitations on activities and requirements to hold additional capital, as well as changes to the Dodd-Frank Act pursuant to the Economic Growth, Regulatory Relief, and Consumer Protection Act; our ability to avoid litigation and its associated costs and liabilities; future Federal Deposit Insurance Corporation (“FDIC”) special assessments or changes to regular assessments; fraud, cybersecurity and privacy risks; and custom technology preferences of our customers and our ability to successfully execute on initiatives relating to enhancements of our technology infrastructure, including client-facing systems and applications. For a discussion of these and other risks and uncertainties, see First Republic’s FDIC filings, including, but not limited to, the risk factors in First Republic’s Annual Report on Form 10-K and any subsequent reports filed by First Republic with the FDIC. These filings are available in the Investor Relations section of our website.

All forward-looking statements are necessarily only estimates of future results, and there can be no assurance that actual results will not differ materially from expectations, and, therefore, you are cautioned not to place undue reliance on such statements. Any forward-looking statements are qualified in their entirety by reference to the factors discussed throughout our public filings under the Exchange Act. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events.

CONSOLIDATED STATEMENTS OF INCOME
	Quarter Ended March 31,					Quarter Ended December 31,
(in thousands, except per share amounts)	2021			2020		2020
Interest income:
Loans	$	873,170		$	796,652	$	845,150
Investments	140,711			148,569		138,429
Other	5,189			6,960		5,754
Cash and cash equivalents	2,894			3,940		1,819
Total interest income	1,021,964			956,121		991,152
Interest expense:
Deposits	27,571			118,845		30,405
Borrowings	55,611			85,144		68,019
Total interest expense	83,182			203,989		98,424
Net interest income	938,782			752,132		892,728
Provision (reversal of provision) for credit losses	(14,608		)	62,370		35,066
Net interest income after provision (reversal of provision) for credit losses	953,390			689,762		857,662
Noninterest income:
Investment management fees	119,042			99,296		114,287
Brokerage and investment fees	14,564			15,826		11,489
Insurance fees	3,074			2,157		5,569
Trust fees	5,731			4,976		5,366
Foreign exchange fee income	17,167			12,184		14,688
Deposit fees	6,169			6,597		6,115
Loan and related fees	7,485			6,114		7,167
Loan servicing fees, net	1,488			1,652		1,248
Gain on sale of loans	309			1,925		2,412
Gain on investment securities	655			2,628		88
Income from investments in life insurance	16,549			8,160		16,997
Other income	3,618			2,529		2,211
Total noninterest income	195,851			164,044		187,637
Noninterest expense:
Salaries and employee benefits	463,404			361,204		415,767
Information systems	83,516			70,715		79,331
Occupancy	57,549			53,641		56,627
Professional fees	21,254			13,117		18,015
Advertising and marketing	12,633			11,843		13,762
FDIC assessments	11,900			10,185		11,650
Other expenses	70,140			61,312		70,892
Total noninterest expense	720,396			582,017		666,044
Income before provision for income taxes	428,845			271,789		379,255
Provision for income taxes	94,012			53,103		83,695
Net income	334,833			218,686		295,560
Dividends on preferred stock	18,525			13,020		16,072
Net income available to common shareholders	$	316,308		$	205,666	$	279,488
Basic earnings per common share	$	1.81		$	1.20	$	1.61
Diluted earnings per common share	$	1.79		$	1.20	$	1.60
Weighted average shares—basic	174,820			170,835		173,111
Weighted average shares—diluted	176,951			172,039		174,708

CONSOLIDATED BALANCE SHEETS
	As of
($ in thousands)	March 31, 2021			December 31, 2020			March 31, 2020
ASSETS
Cash and cash equivalents	$	8,889,492		$	5,094,754		$	3,949,378
Debt securities available-for-sale	2,428,833			1,906,315			1,243,798
Debt securities held-to-maturity	19,240,358			16,610,212			17,534,920
Less: Allowance for credit losses	(8,024		)	(6,902		)	(5,087		)
Debt securities held-to-maturity, net	19,232,334			16,603,310			17,529,833
Equity securities (fair value)	21,221			20,566			19,575
Loans:
Single family	65,178,442			61,370,246			49,063,193
Home equity lines of credit	2,392,314			2,449,533			2,703,919
Single family construction	841,962			787,854			779,239
Multifamily	14,141,208			13,768,957			12,823,392
Commercial real estate	8,065,262			8,018,158			7,715,266
Multifamily/commercial construction	2,101,119			2,024,420			1,839,445
Capital call lines of credit	8,653,802			8,149,946			7,512,231
Tax-exempt	3,454,471			3,365,572			3,087,751
Other business	3,679,420			3,340,048			3,094,922
PPP	2,142,253			1,841,376			—
Stock secured	2,519,637			2,518,338			1,919,971
Other secured	1,862,529			1,818,550			1,531,705
Unsecured	3,050,999			3,113,267			3,214,028
Total loans	118,083,418			112,566,265			95,285,062
Allowance for credit losses	(620,825		)	(635,019		)	(541,906		)
Loans, net	117,462,593			111,931,246			94,743,156
Loans held for sale	—			20,679			354,873
Investments in life insurance	2,328,844			2,061,362			1,460,909
Tax credit investments	1,127,465			1,131,905			1,106,693
Premises, equipment and leasehold improvements, net	412,331			403,482			392,953
Goodwill and other intangible assets	225,925			227,512			232,985
Other real estate owned	1,334			—			1,071
Other assets	3,667,588			3,101,003			2,879,705
Total Assets	$	155,797,960		$	142,502,134		$	123,914,929
LIABILITIES AND EQUITY
Liabilities:
Deposits:
Noninterest-bearing checking	$	53,806,762		$	46,281,112		$	36,920,635
Interest-bearing checking	32,542,600			30,603,221			20,941,790
Money market checking	19,210,069			16,778,884			12,636,674
Money market savings and passbooks	14,097,001			12,584,522			9,052,690
Certificates of deposit	8,250,521			8,681,061			14,140,550
Total Deposits	127,906,953			114,928,800			93,692,339
Long-term FHLB advances	10,505,000			11,755,000			16,250,000
Senior notes	996,668			996,145			994,742
Subordinated notes	778,423			778,313			777,990
Other liabilities	2,669,186			2,293,230			1,840,093
Total Liabilities	142,856,230			130,751,488			113,555,164
Shareholders’ Equity:
Preferred stock	2,142,500			1,545,000			1,145,000
Common stock	1,763			1,741			1,714
Additional paid-in capital	5,191,932			4,834,172			4,543,650
Retained earnings	5,626,958			5,346,355			4,652,089
Accumulated other comprehensive income (loss)	(21,423		)	23,378			17,312
Total Shareholders’ Equity	12,941,730			11,750,646			10,359,765
Total Liabilities and Shareholders’ Equity	$	155,797,960		$	142,502,134		$	123,914,929

	Quarter Ended March 31,														Quarter Ended December 31,
	2021							2020							2020
Average Balances, Yields and Rates	Average Balance		Interest Income/Expense ^(1)			Yields/ Rates ^(2)		Average Balance		Interest Income/Expense ^(1)			Yields/ Rates ^(2)		Average Balance		Interest Income/Expense ^(1)			Yields/ Rates ^(2)
($ in thousands)
Assets:
Cash and cash equivalents	$	11,448,652	$	2,894		0.10	%	$	1,853,579	$	3,940		0.85	%	$	6,965,598	$	1,819		0.10	%
Investment securities:
U.S. Government-sponsored agency securities	93,889		339			1.45	%	307,449		2,207			2.87	%	50,000		196			1.57	%
Agency residential and commercial MBS	5,625,748		30,536			2.17	%	6,746,664		47,186			2.80	%	5,786,312		32,237			2.23	%
Other residential and commercial MBS	32,992		154			1.87	%	3,834		32			3.33	%	35,437		184			2.08	%
Municipal securities	13,349,101		134,990			4.04	%	11,358,749		122,542			4.32	%	12,638,677		130,938			4.14	%
Other investment securities^(3)	429,289		2,568			2.39	%	43,783		320			2.92	%	76,272		511			2.68	%
Total investment securities	19,531,019		168,587			3.45	%	18,460,479		172,287			3.73	%	18,586,698		164,066			3.53	%
Loans:
Residential real estate ^(4)	65,458,977		469,010			2.87	%	51,300,013		404,982			3.16	%	61,523,322		445,028			2.89	%
Multifamily ^(5)	13,922,237		122,829			3.53	%	12,565,723		118,944			3.74	%	13,596,444		125,042			3.60	%
Commercial real estate	8,032,825		77,879			3.88	%	7,574,573		78,609			4.11	%	7,909,682		78,599			3.89	%
Multifamily/commercial construction	2,867,284		31,100			4.34	%	2,550,647		30,285			4.70	%	2,788,321		31,588			4.43	%
Business ^(6)	15,076,564		123,741			3.28	%	12,390,386		122,971			3.93	%	13,382,558		115,809			3.39	%
PPP	1,989,987		15,766			3.17	%	—		—			—	%	2,004,127		14,419			2.82	%
Other ^(7)	7,347,624		39,685			2.16	%	6,453,056		47,572			2.92	%	7,253,376		41,385			2.23	%
Total loans	114,695,498		880,010			3.07	%	92,834,398		803,363			3.44	%	108,457,830		851,870			3.11	%
FHLB stock	344,990		5,189			6.10	%	406,974		6,960			6.88	%	412,789		5,754			5.55	%
Total interest-earning assets	146,020,159		1,056,680			2.90	%	113,555,430		986,550			3.46	%	134,422,915		1,023,509			3.02	%
Noninterest-earning cash	413,625							443,255							452,927
Goodwill and other intangibles	226,683							234,078							228,315
Other assets	6,091,492							4,721,313							5,706,213
Total noninterest-earning assets	6,731,800							5,398,646							6,387,455
Total Assets	$	152,751,959						$	118,954,076						$	140,810,370
Liabilities and Equity:
Deposits:
Checking	$	83,679,569	2,074			0.01	%	$	53,863,519	8,432			0.06	%	$	73,876,676	2,214			0.01	%
Money market checking	18,888,949		7,644			0.16	%	12,724,620		29,302			0.93	%	16,890,334		8,214			0.19	%
Money market savings and passbooks	13,640,388		6,310			0.19	%	9,750,489		15,567			0.64	%	12,259,216		5,925			0.19	%
CDs	8,413,083		11,543			0.56	%	14,185,945		65,544			1.86	%	8,813,489		14,052			0.63	%
Total deposits	124,621,989		27,571			0.09	%	90,524,573		118,845			0.53	%	111,839,715		30,405			0.11	%
Borrowings:
Short-term borrowings	6		—			0.18	%	1,231,827		4,700			1.53	%	8,638		4			0.17	%
Long-term FHLB advances	11,321,666		40,463			1.45	%	13,420,604		66,566			1.99	%	13,298,478		52,873			1.58	%
Senior notes^(8)	996,412		6,038			2.42	%	765,308		4,773			2.49	%	995,892		6,034			2.42	%
Subordinated notes ^(8)	778,369		9,110			4.68	%	777,938		9,105			4.68	%	778,260		9,108			4.68	%
Total borrowings	13,096,453		55,611			1.72	%	16,195,677		85,144			2.11	%	15,081,268		68,019			1.80	%
Total interest-bearing liabilities	137,718,442		83,182			0.24	%	106,720,250		203,989			0.77	%	126,920,983		98,424			0.31	%
Noninterest-bearing liabilities	2,637,481							2,030,107							2,341,078
Preferred equity	1,963,583							1,145,000							1,552,609
Common equity	10,432,453							9,058,719							9,995,700
Total Liabilities and Equity	$	152,751,959						$	118,954,076						$	140,810,370
Net interest spread ^(9)						2.65	%						2.69	%						2.71	%
Net interest income (fully taxable-equivalent basis) and net interest margin^(10)			$	973,498		2.67	%			$	782,561		2.74	%			$	925,085		2.73	%
Reconciliation of tax-equivalent net interest income to reported net interest income:
Municipal securities tax-equivalent adjustment			(27,876		)					(23,718		)					(25,638		)
Business loans tax-equivalent adjustment			(6,840		)					(6,711		)					(6,719		)
Net interest income, as reported			$	938,782						$	752,132						$	892,728

__________

^(1) Interest income is presented on a fully taxable-equivalent basis.

^(2) Yields/rates are annualized.

^(3) Includes corporate debt securities, mutual funds and marketable equity securities.

^(4) Includes single family, home equity lines of credit, and single family construction loans. Also includes single family loans held for sale.

^(5) Includes multifamily loans held for sale.

^(6) Includes capital call lines of credit, tax-exempt and other business loans.

^(7) Includes stock secured, other secured and unsecured loans.

^(8) Average balances include unamortized issuance discounts and costs. Interest expense includes amortization of issuance discounts and costs.

^(9) Net interest spread represents the average yield on interest-earning assets less the average rate on interest-bearing liabilities.

^(10) Net interest margin represents net interest income on a fully taxable-equivalent basis divided by total average interest-earning assets.

	Quarter Ended March 31,						Quarter Ended December 31,
Operating Information	2021			2020			2020
($ in thousands, except per share amounts)
Net income to average assets ^(1)	0.89		%	0.74		%	0.84			%
Net income available to common shareholders to average common equity ^(1)	12.30		%	9.13		%	11.12			%
Net income available to common shareholders to average tangible common equity ^(1)	12.57		%	9.37		%	11.38			%
Dividends per common share	$	0.20		$	0.19		$	0.20
Dividend payout ratio	11.2		%	15.9		%	12.5			%
Efficiency ratio ^(2)	63.5		%	63.5		%	61.6			%
Net loan charge-offs (recoveries)	$	487		$	202		$	(600	)
Net loan charge-offs (recoveries) to average total loans ^(1)	0.00		%	0.00		%	(0.00		)	%
Allowance for loan credit losses to:
Total loans	0.53		%	0.57		%	0.56			%
Nonaccrual loans	359.3		%	432.1		%	344.9			%
__________
^(1) Ratios are annualized.
^(2) Efficiency ratio is the ratio of noninterest expense to the sum of net interest income and noninterest income.

	Quarter Ended March 31,						Quarter Ended December 31,
Effective Tax Rate	2021			2020			2020
Effective tax rate, prior to excess tax benefits—stock awards	22.6		%	21.3		%	22.5		%
Excess tax benefits—stock awards	(0.7	)		(1.8	)		(0.4	)
Effective tax rate	21.9		%	19.5		%	22.1		%

Provision (Reversal of Provision) for Credit Losses	Quarter Ended March 31,					Quarter Ended December 31,
	2021			2020		2020
($ in thousands)
Debt securities held-to-maturity	$	1,122		$	418	$	1,186
Loans	(13,707		)	47,679		29,672
Unfunded loan commitments	(2,023		)	14,273		4,208
Total provision (reversal of provision)	$	(14,608	)	$	62,370	$	35,066

	Quarter Ended March 31,						Quarter Ended December 31,
Mortgage Loan Sales	2021			2020			2020
($ in thousands)
Loans sold:
Flow sales:
Agency	$	42,402		$	25,774		$	152,210
Non-agency	1,073			31,870			—
Total flow sales	43,475			57,644			152,210
Bulk sales:
Non-agency	—			437,669			—
Total loans sold	$	43,475		$	495,313		$	152,210
Gain on sale of loans:
Amount	$	309		$	1,925		$	2,412
Gain as a percentage of loans sold	0.71		%	0.39		%	1.58		%

	Quarter Ended March 31,				Quarter Ended December 31,
Loan Originations	2021		2020		2020
($ in thousands)
Single family	$	6,902,192	$	3,519,336	$	7,777,589
Home equity lines of credit	623,661		395,508		619,257
Single family construction	224,504		109,162		223,909
Multifamily	791,070		781,303		1,016,575
Commercial real estate	313,991		451,858		437,947
Multifamily/commercial construction	310,824		620,921		303,054
Capital call lines of credit	3,131,317		2,385,229		3,854,094
Tax-exempt	213,967		100,019		305,826
Other business	1,025,154		619,779		771,484
PPP	688,948		—		—
Stock secured	710,038		592,560		669,840
Other secured	438,989		413,824		412,902
Unsecured	345,848		322,888		312,809
Total loans originated	$	15,720,503	$	10,312,387	$	16,705,286

	As of
Asset Quality Information	March 31, 2021			December 31, 2020			September 30, 2020			June 30, 2020			March 31, 2020
($ in thousands)
Nonperforming assets:
Nonaccrual loans	$	172,794		$	184,132		$	164,247		$	164,930		$	125,418
Other real estate owned	1,334			—			—			1,071			1,071
Total nonperforming assets	$	174,128		$	184,132		$	164,247		$	166,001		$	126,489
Nonperforming assets to total assets	0.11		%	0.13		%	0.12		%	0.13		%	0.10		%
Accruing loans 90 days or more past due	$	851		$	—		$	935		$	3,764		$	—
Restructured accruing loans	$	11,658		$	11,253		$	11,378		$	11,501		$	13,418

	March 31, 2021
COVID-19 Loan Modifications ^(1), (2), (3), (4), (5)	Unpaid Principal Balance		Deferred Interest ^(6)		LTV ^(7)		Average Loan Size		Number of Loans
($ in millions)
Single family	$	274	$	5	59	%	$	1.2	232
Home equity lines of credit	15		—		62	%	$	0.7	22
Single family construction	2		—		75	%	$	2.2	1
Multifamily	199		1		50	%	$	6.2	32
Commercial real estate	274		1		46	%	$	6.5	42
Multifamily/commercial construction	19		1		38	%	$	19.0	1
Capital call lines of credit	—		—		n/a		$	—	—
Tax-exempt	135		1		n/a		$	19.3	7
Other business	32		—		n/a		$	1.3	24
Stock secured	—		—		n/a		$	—	—
Other secured	4		—		n/a		$	0.3	13
Unsecured ^(8)	13		—		n/a		$	0.1	118
Total	$	967	$	9					492
__________
^(1) COVID-19 loan modifications are not classified as troubled debt restructurings.
^(2) Includes 93 loans totaling $28 million that have completed their deferral period, but for which a regular payment is not yet due.
^(3) Includes 294 loans totaling $566 million that received additional relief beyond their initial modification period.
^(4) Excludes loans that have completed their deferral period and returned to a regular payment schedule or are no longer outstanding. As of March 31, 2021, $3.3 billion of loans have completed their deferral period or are no longer outstanding, and 99% of the outstanding loans were current.
^(5) Loan modifications requested by borrowers that were in process but not yet completed as of March 31, 2021 totaled $12 million for initial relief, and $7 million for additional relief beyond the initial modification period.
^(6) Represents interest payments not made during the deferral period through March 31, 2021.
^(7) Weighted average loan-to-value (“LTV”) ratios for real estate secured loans are based on appraised value at the time of origination.
^(8) Consists of household debt refinance loans.

	March 31, 2021
Loan Industry Information	Unpaid Principal Balance		LTV		Average Loan Size		Number of Loans	Personal Guarantee %
($ in millions)
Retail	$	1,862	49	%	$	2.7	713	77	%
Hotel	420		48	%	$	6.6	65	73	%
Restaurant ^(1)	215		49	%	$	1.1	204	94	%
Total ^(2)	$	2,497					982
__________
^(1) Approximately 72% of loans to restaurants are real estate secured.
^(2) Amounts in the table above exclude $62 million of loans to hotels and $240 million of loans to restaurants under the PPP.

	As of
Loan Servicing Portfolio	March 31, 2021		December 31, 2020		September 30, 2020		June 30, 2020		March 31, 2020
($ in millions)
Loans serviced for investors	$	6,314	$	7,094	$	7,799	$	8,316	$	9,203

	As of
Book Value per Common Share and Tangible Book Value per Common Share	March 31, 2021		December 31, 2020		September 30, 2020		June 30, 2020		March 31, 2020
(in thousands, except per share amounts)
Total shareholders’ equity	$	12,941,730	$	11,750,646	$	11,344,609	$	10,575,928	$	10,359,765
Less: Preferred stock	2,142,500		1,545,000		1,645,000		1,145,000		1,145,000
Total common shareholders’ equity (a)	10,799,230		10,205,646		9,699,609		9,430,928		9,214,765
Less: Goodwill and other intangible assets	225,925		227,512		229,185		230,975		232,985
Total tangible common shareholders’ equity (b)	$	10,573,305	$	9,978,134	$	9,470,424	$	9,199,953	$	8,981,780
Number of shares of common stock outstanding (c)	176,287		174,124		172,188		172,094		171,395
Book value per common share (a) / (c)	$	61.26	$	58.61	$	56.33	$	54.80	$	53.76
Tangible book value per common share (b) / (c)	$	59.98	$	57.30	$	55.00	$	53.46	$	52.40

	As of
Regulatory Capital Ratios and Components ^(1), (2)	March 31, 2021 ^(3)			December 31, 2020			September 30, 2020			June 30, 2020			March 31, 2020
($ in thousands)
Capital Ratios:
Tier 1 leverage ratio (Tier 1 capital to average assets)	8.32		%	8.14		%	8.38		%	8.15		%	8.46		%
Common Equity Tier 1 capital to risk-weighted assets	9.64		%	9.67		%	9.78		%	9.80		%	9.87		%
Tier 1 capital to risk-weighted assets	11.60		%	11.18		%	11.50		%	11.04		%	11.14		%
Total capital to risk-weighted assets	12.87		%	12.55		%	12.94		%	12.49		%	12.62		%
Regulatory Capital:
Common Equity Tier 1 capital	$	10,548,615		$	9,894,870		$	9,375,688		$	9,103,771		$	8,887,905
Tier 1 capital	$	12,691,115		$	11,439,870		$	11,020,688		$	10,248,771		$	10,032,905
Total capital	$	14,082,378		$	12,842,344		$	12,396,304		$	11,604,141		$	11,365,654
Assets:
Average assets	$	152,465,399		$	140,493,283		$	131,517,445		$	125,690,830		$	118,626,842
Risk-weighted assets	$	109,412,853		$	102,321,489		$	95,823,385		$	92,870,859		$	90,072,400
__________
^(1) As defined by regulatory capital rules.
^(2) Beginning in 2020, ratios and amounts reflect the Bank's election to delay the estimated impact of the Current Expected Credit Losses (“CECL”) allowance methodology on its regulatory capital, average assets and risk-weighted assets over a five-year transition period ending December 31, 2024.
^(3) Ratios and amounts as of March 31, 2021 are preliminary.

	As of
Wealth Management Assets	March 31, 2021		December 31, 2020		September 30, 2020		June 30, 2020		March 31, 2020
($ in millions)
First Republic Investment Management	$	90,819	$	83,596	$	74,661	$	68,124	$	60,056
Brokerage and investment:
Brokerage	101,478		88,059		76,769		70,178		60,189
Money market mutual funds	11,435		9,003		4,416		5,933		6,893
Total brokerage and investment	112,913		97,062		81,185		76,111		67,082
Trust Company:
Trust	10,986		9,910		8,687		7,905		7,288
Custody	4,216		3,889		3,651		3,646		3,461
Total Trust Company	15,202		13,799		12,338		11,551		10,749
Total Wealth Management Assets	$	218,934	$	194,457	$	168,184	$	155,786	$	137,887