Pennsylvania Commerce Bancorp to Merge with Republic First Bancorp

Weekly Corporate Growth Report, Nov 17, 2008

The Deal: Pennsylvania Commerce Bancorp and Republic First Bancorp have signed a definitive agreement to merge, creating a new company to be known as Metro Bancorp. Under the terms of the agreement, Republic First shareholders will receive a fraction of a Pennsylvania Commerce share valued at $10 in exchange for each share of Republic First. The actual fraction of a Pennsylvania Commerce share will be determined by the stock's average closing price for 20 consecutive trading days preceding the effective date of the merger. The transaction has been approved by the boards of both banks but remains subject to other customary closing conditions.

Discussion: Republic First Bancorp is the holding company for Republic First Bank. The bank serves individuals and small to midsized businesses in Greater Philadelphia and southeast Pennsylvania. The bank operates about a dozen branches. The majority of the bank's loan portfolio is focused on commercial mortgages. Other loans include consumer loans, business loans, and residential mortgages.

Pennsylvania Commerce is the holding company for Commerce Bank/Harrisburg, which has more than 30 branches in south-central Pennsylvania. The bank's loan portfolio includes commercial mortgages and lines of credit, business loans, and consumer loans.

The acquisition will help Pennsylvania Commerce expand into new markets.