First Republic Reports Strong Second Quarter Results

__________

⁽¹⁾ See non-GAAP reconciliation under section “Use of Non-GAAP Financial Measures.”

Conference Call Details

First Republic Bank’s second quarter 2012 earnings conference call is scheduled for July 18, 2012 at 11:00 a.m. PDT / 2:00 p.m. EDT. To listen to the live call by telephone, please dial [phone] approximately 10 minutes prior to the start time (to allow time for registration) and use conference ID #396823. International callers should dial [phone]. 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 www.firstrepublic.com. To listen to the live webcast, please visit the site at least 15 minutes prior to the start of the call to register, download and install any necessary audio software. A replay of the call will also be available for 90 days on the website. For those unable to participate in the live presentation, a replay will be available beginning July 18, 2012, at 2:00 p.m. PDT / 5:00 p.m. EDT, through July 25, 2012, at 8:59 p.m. PDT / 11:59 p.m. EDT. To access the replay, dial [phone] (U.S.) and use conference ID #396823. International callers should dial [phone] and enter the same conference ID number. The Bank’s press releases are available after release on the Bank’s website at www.firstrepublic.com.

About First Republic Bank

First Republic Bank and its subsidiaries provide private banking, private business banking and private wealth management. Founded in 1985, First Republic specializes in exceptional, relationship-based service offered through preferred banking or wealth management offices primarily in San Francisco, Palo Alto, Los Angeles, Santa Barbara, Newport Beach, San Diego, Portland, Boston, Greenwich and New York City. First Republic offers a complete line of banking products for individuals and businesses, including deposit services, as well as residential, commercial and personal loans. First Republic is a component of the S&P Total Market Index, the Wilshire 5000 Total Market Index ^SM, the Russell 1000 ^®, Russell 3000 ^® and Russell Global indices and six Dow Jones indices. More information is available on the Bank’s website at www.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. 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 and include statements about economic performance in our markets, growth in our loan originations and wealth management assets, and our projected tax rate. 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. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to: our ability to compete for banking and wealth management customers; earthquakes and other natural disasters in our markets; changes in interest rates; our ability to maintain high underwriting standards; economic conditions in our markets; and conditions in financial markets and economic conditions generally; regulatory restrictions on our operations and current or future legislative or regulatory changes affecting the banking and investment management industries. 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 Quarterly Reports on Form 10-Q. 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. 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 STATEMENT OF INCOME
		Three Months Ended June 30,								Three Months Ended March 31,				Six Months Ended June 30,
(in thousands, except per share amounts)			2012				2011				2012				2012				2011
Interest income:
Interest on loans		$	291,040			$	268,768			$	279,674			$	570,714			$	537,508
Interest on investments			30,265				15,890				28,859				59,124				27,878
Interest on cash equivalents			822				1,276				623				1,445				2,469
Total interest income			322,127				285,934				309,156				631,283				567,855
Interest expense:
Interest on customer deposits			16,678				22,313				14,987				31,665				44,067
Interest on FHLB advances and other borrowings			14,302				6,246				12,345				26,647				11,341
Interest on subordinated notes			550				573				556				1,106				1,151
Total interest expense			31,530				29,132				27,888				59,418				56,559
Net interest income			290,597				256,802				281,268				571,865				511,296
Provision for loan losses			14,875				13,026				14,852				29,727				20,639
Net interest income after provision for loan losses			275,722				243,776				266,416				542,138				490,657
Noninterest income:
Investment advisory fees			14,674				11,814				12,699				27,373				22,470
Brokerage and investment fees			2,667				2,155				2,765				5,432				4,501
Trust fees			2,185				1,694				1,773				3,958				3,420
Foreign exchange fee income			2,639				2,152				2,421				5,060				4,247
Deposit customer fees			3,445				3,771				3,281				6,726				7,413
Loan servicing fees, net			(704	)			805				(1,904	)			(2,608	)			573
Loan and related fees			1,465				833				1,483				2,948				1,649
Gain on sale of loans			4,754				427				3,809				8,563				4,781
Income from investments in life insurance			5,618				4,092				5,371				10,989				7,822
Other income (loss)			(104	)			(546	)			947				843				1,387
Total noninterest income			36,639				27,197				32,645				69,284				58,263
Noninterest expense:
Salaries and related benefits			81,533				68,733				82,507				164,040				132,954
Occupancy			20,690				15,912				19,895				40,585				31,926
Information systems			17,746				14,212				16,174				33,920				26,725
Advertising and marketing			7,144				7,053				5,962				13,106				13,362
FDIC and other deposit assessments			5,902				4,497				5,400				11,302				13,197
Professional fees			5,453				3,010				4,278				9,731				7,443
Amortization of intangibles			5,170				5,760				5,288				10,458				11,677
Tax credit investments			4,521				1,474				5,250				9,771				3,078
Other expenses			23,396				18,178				20,001				43,397				33,456
Total noninterest expense			171,555				138,829				164,755				336,310				273,818
Income before provision for income taxes			140,806				132,144				134,306				275,112				275,102
Provision for income taxes			42,274				46,142				41,635				83,909				99,037
Net income before noncontrolling interests			98,532				86,002				92,671				191,203				176,065
Less: Net income from noncontrolling interests			625				1,170				913				1,538				2,461
First Republic Bank net income			97,907				84,832				91,758				189,665				173,604
Dividends on preferred stock			4,091				-				2,451				6,542				-
Redemption of preferred stock			13,200				-				-				13,200				-
Net income available to common stockholders		$	80,616			$	84,832			$	89,307			$	169,923			$	173,604
Basic earnings per common share		$	0.62			$	0.66			$	0.69			$	1.31			$	1.35
Diluted earnings per common share		$	0.60			$	0.64			$	0.67			$	1.27			$	1.31
Weighted average shares - basic			129,890				128,858				129,498				129,694				128,858
Weighted average shares - diluted			134,002				133,091				133,621				133,816				132,848

CONSOLIDATED BALANCE SHEET
		As of
($ in thousands)		June 30, 2012				March 31, 2012				December 31, 2011				June 30, 2011
ASSETS
Cash and cash equivalents		$	800,818			$	1,429,286			$	630,780			$	790,767
Securities purchased under agreements to resell			19,330				12,973				4,890				8,267
Investment securities available-for-sale			782,098				682,835				722,280				563,008
Investment securities held-to-maturity			2,323,241				2,209,463				2,097,198				1,430,655
Loans:
Single family (1-4 units)			15,192,602				14,175,779				13,538,218				12,124,085
Home equity lines of credit			1,934,143				1,826,061				1,878,969				1,781,041
Commercial real estate			2,719,024				2,629,595				2,504,791				2,312,605
Multifamily (5+ units)			2,631,934				2,569,780				2,437,169				2,121,549
Single family construction			209,156				198,240				183,863				182,977
Multifamily/commercial construction			129,159				110,193				122,885				85,751
Commercial business loans			2,036,005				1,799,668				1,656,795				1,286,026
Other secured			171,579				192,619				169,502				151,084
Unsecured loans and lines of credit			337,480				300,038				224,069				145,857
Stock secured			99,346				79,005				103,208				82,150
Total unpaid principal balance			25,460,428				23,880,978				22,819,469				20,273,125
Net unaccreted discount			(410,197	)			(455,885	)			(493,895	)			(590,460	)
Net deferred fees and costs			17,780				13,456				10,020				5,604
Allowance for loan losses			(97,049	)			(82,418	)			(68,113	)			(38,200	)
Loans, net			24,970,962				23,356,131				22,267,481				19,650,069
Loans held for sale			63,957				53,184				305,881				59,358
Investments in life insurance			620,085				591,397				585,956				432,496
Tax credit investments			419,968				389,000				330,447				166,589
Prepaid expenses and other assets			686,096				695,575				548,395				395,183
Premises, equipment and leasehold improvements, net			128,481				123,439				118,365				106,478
Goodwill			24,604				24,604				24,604				24,604
Other intangible assets			126,456				129,286				134,574				145,620
Mortgage servicing rights			17,415				17,466				17,269				21,725
Other real estate owned			3,490				4,348				3,681				2,954
Total Assets		$	30,987,001			$	29,718,987			$	27,791,801			$	23,797,773
LIABILITIES AND EQUITY
Liabilities:
Customer deposits:
Noninterest-bearing accounts		$	7,546,456			$	6,275,752			$	6,115,571			$	3,936,714
Interest-bearing checking accounts			3,765,848				3,793,085				3,675,813				2,602,362
Money Market (MM) checking accounts			3,645,809				3,583,467				3,139,448				3,196,680
MM savings and passbooks			5,876,837				6,030,096				5,520,558				5,178,516
Certificates of deposit			3,380,353				3,572,561				4,007,869				5,025,576
Total customer deposits			24,215,303				23,254,961				22,459,259				19,939,848
FHLB advances			3,150,000				3,050,000				2,200,000				1,100,000
Subordinated notes			64,346				65,032				65,711				67,054
Debt related to variable interest entity			53,581				60,030				63,259				22,763
Other liabilities			447,158				425,491				408,550				267,992
Total Liabilities			27,930,388				26,855,514				25,196,779				21,397,657
Equity:
First Republic Bank stockholders’ equity
Preferred stock			349,525				199,525				-				-
Common stock			1,305				1,302				1,294				1,289
Additional paid-in capital			2,012,857				2,019,194				2,020,832				2,008,280
Retained earnings			677,573				583,757				494,450				315,966
Accumulated other comprehensive income (loss)			15,353				12,895				1,186				(2,679	)
Total First Republic Bank stockholders’ equity			3,056,613				2,816,673				2,517,762				2,322,856
Noncontrolling interests			-				46,800				77,260				77,260
Total Equity			3,056,613				2,863,473				2,595,022				2,400,116
Total Liabilities and Equity		$	30,987,001			$	29,718,987			$	27,791,801			$	23,797,773

		Three Months Ended June 30,								Three Months Ended March 31,				Six Months Ended June 30,
($ in thousands)			2012				2011				2012				2012				2011
Operating Information
Loans originated		$	3,963,579			$	2,443,159			$	3,156,526			$	7,120,105			$	4,298,379
Loans sold		$	435,786			$	266,242			$	552,050			$	987,836			$	505,039
Net income to average assets (2)			1.29	%			1.42	%			1.29	%			1.29	%			1.48	%
Net income available to common stockholders
to average common equity (2)			12.07	%			14.83	%			13.86	%			12.95	%			15.57	%
Efficiency ratio (3)			52.4	%			48.9	%			52.5	%			52.5	%			48.1	%
Efficiency ratio (non-GAAP) (3), (4)			60.5	%			59.1	%			59.6	%			60.1	%			58.9	%
Yields/Rates (2)
Cash and cash equivalents			0.26	%			0.28	%			0.27	%			0.27	%			0.25	%
Securities purchased under agreements to resell			0.13	%			0.03	%			0.09	%			0.11	%			0.05	%
Investment securities (5)			5.57	%			5.81	%			5.65	%			5.61	%			6.00	%
Loans (5)			4.83	%			5.61	%			4.88	%			4.86	%			5.69	%
Total interest-earning assets			4.71	%			5.19	%			4.81	%			4.76	%			5.23	%
Checking			0.02	%			0.05	%			0.02	%			0.02	%			0.05	%
Money market checking and savings			0.29	%			0.45	%			0.21	%			0.25	%			0.46	%
CDs			1.09	%			0.92	%			1.04	%			1.07	%			0.88	%
Total deposits			0.28	%			0.44	%			0.26	%			0.27	%			0.44	%
FHLB advances			1.80	%			2.41	%			1.92	%			1.85	%			2.47	%
Other borrowings			2.58	%			2.90	%			2.62	%			2.60	%			2.81	%
Total borrowings			1.83	%			2.45	%			1.95	%			1.88	%			2.50	%
Total interest-bearing liabilities			0.47	%			0.55	%			0.44	%			0.46	%			0.54	%
Net interest spread			4.24	%			4.64	%			4.37	%			4.30	%			4.69	%
Net interest margin			4.27	%			4.67	%			4.39	%			4.32	%			4.72	%
Net interest margin (non-GAAP) (4)			3.48	%			3.54	%			3.64	%			3.56	%			3.54	%

(2) Ratios are annualized.

(3) Efficiency ratio is the ratio of noninterest expense to the sum of net interest income and noninterest income.

(4) For a reconciliation of these ratios to the equivalent GAAP ratios, see “Use of Non-GAAP Financial Measures.”

(5) Yield is calculated on a tax-equivalent basis.

The following table separates our loan portfolio as of June 30, 2012 between loans acquired on July 1, 2010 and loans originated since July 1, 2010:

		Composition of Loan Portfolio
		Loans acquired				Loans originated				Total loans at
		on July 1,				since July 1,				June 30,
($ in thousands)			2010				2010				2012
Single family (1-4 units)		$	6,173,298			$	9,019,304			$	15,192,602
Home equity lines of credit			1,195,775				738,368				1,934,143
Commercial real estate			1,532,012				1,187,012				2,719,024
Multifamily (5+ units)			990,690				1,641,244				2,631,934
Single family construction			20,549				188,607				209,156
Multifamily/commercial construction			12,811				116,348				129,159
Commercial business loans			556,578				1,479,427				2,036,005
Other secured			52,067				119,512				171,579
Unsecured loans and lines of credit			57,452				280,028				337,480
Stock secured			12,748				86,598				99,346
Total unpaid principal balance			10,603,980				14,856,448				25,460,428
Net unaccreted discount			(409,439	)			(758	)			(410,197	)
Net deferred fees and costs			(7,836	)			25,616				17,780
Allowance for loan losses			(13,389	)			(83,660	)			(97,049	)
Loans, net		$	10,173,316			$	14,797,646			$	24,970,962

		As of
		June 30,				March 31,				December 31,				June 30,
(in thousands, except per share amounts)			2012				2012				2011				2011
Book Value
Number of shares of common stock outstanding			130,532				130,236				129,372				128,858
Book value per common share		$	20.74			$	20.10			$	19.46			$	18.03
Tangible book value per common share		$	19.58			$	18.91			$	18.23			$	16.71
Capital Ratios
Tier 1 leverage ratio			9.55	%			9.48	%			8.81	%			9.38	%
Tier 1 common equity ratio (6)			12.03	%			12.73	%			12.84	%			13.90	%
Tier 1 risk-based capital ratio			13.68	%			14.01	%			13.25	%			14.39	%
Total risk-based capital ratio			14.17	%			14.47	%			13.65	%			14.74	%

(6) Tier 1 common equity ratio represents common equity less goodwill and intangible assets divided by risk-weighted assets.

		As of
		June 30,			March 31,			December 31,			June 30,
($ in millions)		2012			2012			2011			2011
Assets Under Management (7)
First Republic Investment Management		$	9,918		$	8,955		$	7,940		$	7,879
Brokerage and Investment:
Brokerage			7,663			7,777			6,806			6,862
Money Market Mutual Funds			779			666			1,037			646
Total Brokerage and Investment			8,442			8,443			7,843			7,508
Trust Company:
Trust			2,196			2,089			1,963			1,898
Custody			2,734			2,565			2,641			2,351
Total Trust Company			4,930			4,654			4,604			4,249
Total Wealth Management Assets			23,290			22,052			20,387			19,636
Loans serviced for investors			3,827			3,651			3,381			3,877
Total fee-based assets		$	27,117		$	25,703		$	23,768		$	23,513

(7) Assets under management are presented excluding sweep deposits.

		As of
		June 30,				March 31,				December 31,				June 30,
($ in thousands)			2012				2012				2011				2011
Asset Quality Information
Nonperforming assets:
Nonaccrual loans		$	28,595			$	27,480			$	26,373			$	26,740
Other real estate owned			3,490				4,348				3,681				2,954
Total nonperforming assets		$	32,085			$	31,828			$	30,054			$	29,694
Nonperforming assets to total assets			0.10	%			0.11	%			0.11	%			0.12	%
Restructured performing loans		$	7,978			$	5,783			$	6,674			$	5,159

		Average Balance Sheet
		Three Months Ended June 30,						Three Months Ended March 31,			Six Months Ended June 30,
($ in thousands)		2012			2011			2012			2012			2011
Assets:
Cash equivalents		$	1,251,267		$	1,826,348		$	912,075		$	1,081,671		$	1,952,824
Securities purchased under agreements to resell			17,810			11,849			21,018			19,414			7,421
Investment securities (8)			3,142,539			1,630,533			2,958,810			3,050,675			1,408,535
Loans (9)			24,182,518			19,159,668			22,996,300			23,589,409			18,932,701
Total interest-earning assets			28,594,134			22,628,398			26,888,203			27,741,169			22,301,481
Noninterest-earning assets			1,837,582			1,329,315			1,733,236			1,785,408			1,311,318
Total Assets		$	30,431,716		$	23,957,713		$	28,621,439		$	29,526,577		$	23,612,799
Liabilities and Equity:
Checking		$	10,792,468		$	6,566,733		$	9,749,583		$	10,271,026		$	6,307,848
Money market checking and savings			9,480,389			8,433,182			9,254,760			9,367,574			8,302,151
CDs (9)			3,467,158			5,246,008			3,759,487			3,613,322			5,451,389
Total deposits			23,740,015			20,245,923			22,763,830			23,251,922			20,061,388
FHLB advances			3,139,011			1,027,472			2,530,769			2,834,890			913,260
Subordinated notes (9)			64,680			67,377			65,363			65,022			67,706
Debt related to variable interest entity			59,850			23,044			62,425			61,138			23,969
Total borrowings			3,263,541			1,117,893			2,658,557			2,961,050			1,004,935
Total interest-bearing liabilities			27,003,556			21,363,816			25,422,387			26,212,972			21,066,323
Noninterest-bearing liabilities			447,526			218,013			392,820			420,172			214,231
Common equity			2,686,401			2,294,634			2,591,806			2,639,103			2,248,350
Preferred equity			247,657			-			147,887			197,772			-
Noncontrolling interests			46,576			81,250			66,539			56,558			83,895
Total Liabilities and Equity		$	30,431,716		$	23,957,713		$	28,621,439		$	29,526,577		$	23,612,799

(8) Includes FHLB stock.

(9) Average balances are presented net of purchase accounting discounts or premiums.

Purchase Accounting Accretion and Amortization

The following table presents the impact of purchase accounting for the periods indicated:

		Three Months Ended June 30,						Three Months Ended March 31,			Six Months Ended June 30,
($ in thousands)		2012			2011			2012			2012			2011
Accretion/amortization to net interest income:
Loans		$	45,768		$	43,773		$	38,153		$	83,921		$	87,082
Deposits			5,715			14,351			7,458			13,173			31,073
Borrowings			686			663			680			1,366			1,320
Total		$	52,169		$	58,787		$	46,291		$	98,460		$	119,475
Noninterest income:
Gain on sale of loans		$	-		$	-		$	-		$	-		$	3,827
Loan commitments			15			166			69			84			1,220
Total		$	15		$	166		$	69		$	84		$	5,047
Amortization to noninterest expense:
Intangible assets		$	5,170		$	5,760		$	5,288		$	10,458		$	11,677

Use of Non-GAAP Financial Measures

Our accounting and reporting policies conform to generally accepted accounting principles in the United States (“GAAP”) and the prevailing practices in the banking industry. However, due to the application of purchase accounting, management uses certain non-GAAP measures and ratios that exclude the impact of these items to evaluate our performance, including net income, earnings per share, net interest margin and the efficiency ratio.

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