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By JEFF HARRINGTON
© St. Petersburg Times, published January 5, 2001
ST. PETERSBURG -- Republic Bank said late Thursday it is pulling out of Miami-Dade County, taking $16.1-million in year-end charges and posting a loss for 2000 in what it deems the final step toward recovery.
"The cleanup is done, the way I look at," said Republic CEO Bill Klich, who was recruited nine months ago to turn around the troubled St. Petersburg bank. "We feel like we've turned over every stone and Republic has been positioned for where we want it to go."
Because of the charges, Republic said it will post a net loss between $4.5-million and $5-million, or 45 cents to 50 cents a share, for the year ended Dec. 31. After a disastrous foray into risky mortgage loans two years ago, the bank returned to profitability during the first three quarters of 2000.
But Klich said he felt compelled to clean up the bank's balance sheet by year-end to prepare it for a profitable 2001.
The one-time charges include a $12.3-million write-down for two investments in high loan-to-value loans made in 1997 and 1998 and a $3.6-million addition to the bank's loan loss reserves. For the year, the bank has added more than $20.7-million to the reserves to cover losses.
Separately, the bank said it is selling its five branches in Miami-Dade to Pointe Bank, a subsidiary of Pointe Financial Corp. of Boca Raton. Terms were not disclosed for the deal, which is expected to close in the first half of this year. The branches have total deposits of $55.5-million.
"Miami-Dade, despite the fact it's my hometown, is a very aggressive and expensive market to do business in," Klich said. "Five offices for a St. Petersburg-based bank doesn't seem to make a lot of sense."
Last month, Republic agreed to sell two branches in Live Oak and Lake City to CNB Bank.
Once both deals close, Republic will be left with 74 branches in 17 counties. No further branch sell-offs are expected, Klich said.