Republic Bancorp (RBCAA)

13.    SUBSEQUENT EVENT

On October 3, 2006, subsequent to the end of the third quarter, Republic completed its acquisition of GulfStream Community Bank (“GulfStream”) of Port Richey, Florida.  On the acquisition date, GulfStream, which began operations in 2000, had total assets of $64 million with total loans of $45 million and total deposits of $54 million.  This acquisition will not materially impact the Company in 2006.

26

22. SUBSEQUENT EVENT

By letter to Republic Bank & Trust Company dated February 17, 2006, the FDIC cited inherent risks associated with payday lending activities and asked Republic Bank & Trust Company to consider terminating this line of business. Consequently, on February 24, 2006, Republic Bank & Trust Company and ACE amended the agreement regarding Republic Bank & Trust Company’s payday loan activities in Texas, Pennsylvania and Arkansas. With respect to Texas, Republic Bank & Trust Company ceased offering payday loans the week of February 27, 2006. With respect to Arkansas and Pennsylvania, Republic Bank & Trust Company will cease offering payday loans on June 30, 2006. During the fourth quarter of 2005, the Company recorded after-tax net income of approximately $299,000 through its marketing/servicing agreement with ACE. For the year ended December 31, 2005 the Company recorded after-tax net income of $1.7 million through its marketing/servicing agreement with ACE.

By letter to Republic Bank & Trust Company of Indiana dated February 17, 2006, the FDIC cited inherent risks associated with payday lending activities and asked Republic Bank & Trust Company of Indiana to consider terminating this line of business. Republic Bank & Trust Company of Indiana voluntarily elected to terminate its Internet payday loan program the week of February 20, 2006. The Internet payday loan program began operating in July 2005 and remained in a developmental stage until its termination date. During the fourth quarter of 2005, the Company recorded an after-tax loss of $517,000 from its Internet payday loan program. For the year ended December 31, 2005, the Company recorded an after-tax loss of $639,000 from its Internet payday loan program.

82