First Republic Bank
Annual Report 2015

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thirty years STRENGTH SERVICE STABILITY 2015 annual report Founded in 1985, First Republic Bank and its subsidiaries provide private banking, private business banking and private wealth management, including investment, trust and brokerage services. First Republic specializes in deliv- ering exceptional relationship-based service, with a solid commitment to responsiveness and action. san francisco • palo alto • los angeles santa barbara • newport beach • san diego portland • palm beach • boston greenwich • new york For over thirty years, we have grown organically—one relationship at a time. 2 3 6 9 1 4 8 5 7 1. James H. Herbert, II Chairman and Chief Executive Offi cer (Founding) 2. Michael D. Selfridge Chief Banking Offi cer 3. Mollie M. Richardson Chief Administrative Offi cer 4. Bob Thornton President Private Wealth Management 5. Michael J. Roffl er Chief Financial Offi cer 6. David B. Lichtman Chief Credit Offi cer 7. Hafi ze Gaye Erkan Chief Deposit Offi cer and Chief Investment Offi cer 8. Jason C. Bender Chief Operating Offi cer 9. Katherine August-deWilde Vice Chair Dear Clients and Shareholders 2015 was another highly successful year for First Republic. Loans, deposits and wealth management all grew nicely. Earnings were strong. Credit quality remained excellent, capital grew very well and liquidity expanded to even stronger levels. We were pleased to be able to successfully access the capi- tal markets three times during the year to support our continued development. We are making very signifi cant investments in the franchise. Th ese investments include the continued build-out of our regulatory and risk management infra- structure, upgraded technology in many parts of the company, improvements to our offi ces and facilities, and the introduction of a much-enhanced online banking system, which is being rolled out in 2016. During the year, we also made a series of executive promotions, which further strengthen our already deep leadership team. Th ese appointments are the con- tinuation of our careful succession planning. Across the board, we experienced strong results in 2015: • Core revenues were up 15%. • Core earnings per share were up 10%. • Total capital increased 19%. • Net charge-off s for the year totaled only $1.7 million, or less than one basis point of total loans. • Tangible book value per share was up 14%. 3. Deposits were up 29% in 2015. We were successful in generating deposits across all of our channels – offi ces, preferred banking, business banking and wealth management. Checking is now 63% of total deposits. Loan volume totaled $19.7 billion, our best year ever. Growth in loans outstanding, which was entirely funded by deposits, was 16% and consistent with our plan. Private Wealth Management had another strong year. Wealth management assets were up 35% to $72 billion in 2015. Revenues were up over 20%, and now equal 13% of total revenues. Our strong growth in wealth management assets during the year was due to continued asset infl ows from both existing and new clients, the acquisition of Constellation Wealth Advisors on October 1, and a number of well-established wealth advisor teams who joined us, particularly in the second half of 2015. Business Banking also had another good year. Both business loans and business deposits grew nicely. At year-end, business loans outstanding represented 14% of total loans, while business deposits represented 51% of total deposits, consisting almost entirely of checking. Financial Highlights / 2010 –2015 Dollars in Billions DECEMBER 31, 2 010 2 011 2 012 2 013 2 014 2 015 Total Bank Assets $ 22.4 $ 27.8 $ 34.4 $ 42.1 $ 48.4 $ 59.0 Total Loans $ 19.2 $ 22.8 $ 28.3 $ 34.2 $ 37.9 $ 44.1 Total Deposits $ 19.2 $ 22.5 $ 27.1 $ 32.1 $ 37.1 $ 47.9 Total Tier 1 Leverage Capital $ 2.0 $ 2.4 $ 3.1 $ 3.9 $ 4.6 $ 5.5 Wealth Management Assets $ 16.6 $ 20.2 $ 31.3 $ 41.6 $ 53.4 $ 72.3 Preferred Banking Offi ces 56 58 61 66 68 68 Compound Annual Growth Rate / 2010 –2015 LOANS DEP O SITS TI ER 1 LEVERAGE CAPITAL WEALTH MGMT ASSETS Percentage Increase Dollars in Billions +18% +20% +22% +34% $ 19.2 $ 44.1 $ 19.2 $ 47.9 $ 2.0 $ 5.5 $ 16.6 $ 72.3 Years 2010 – 2015 2010 – 2015 2010 – 2015 2010 – 2015 Actual Loss Experience – All Loans / 2010 –2015 ACTUAL NET CHARGE- OFFS AS % OF AVERAGE LOANS 1.25% 1.00% 0.75% 0.50% 0.25% 0.00% • Net charge-off s have averaged only 2 bps per year over 5.5 years • Top 50 U.S. banks’ net charge-off s averaged 42 bps1 per year over 5.5 years • Average losses at the top 50 U.S. banks were 24x those of First Republic 50 LARGEST U.S. BANKS FIRST REPUBLIC BANK 2010 2 2011 2012 2013 2014 2015 1) Comprised of the median for the top 50 U.S. banks by asset size as of December 31 of each corresponding year. FRC 3 0.01 0.03 0.01 0.05 0.01 0.01 2) For the six months ended December 31, 2010. 3) Net charge-offs include charge-offs against unaccreted loan TOP 50 U.S. BANKS 1 0.71 1.13 0.54 0.32 0.20 0.17 discounts, if any. 4. 5. We continue to monitor global economic conditions carefully, particularly as they pertain to the historically unique and unpredictable winding down of quantitative easing, and the bumpy nature of this year’s U.S. presidential election. As a result, we are more conservative, even than normal, in our actions. We remain cautious, but optimistic, about the general economic environment, particularly in our markets, and are confi dent in the company’s overall conservative posture. In the face of such conditions, First Republic continues to execute a simple business model that off ers stability and predictability. We remain focused on the pillars of our model – strong capital, considerable liquidity, the best possible credit quality and exceptional client service. Overall, the franchise is performing well and we look forward to a successful 2016. Of course, without our communities of clients and shareholders, First Republic would not be what it is today. We sincerely thank you for your continued business and truly appreciate your ongoing support. It’s a privilege to serve you, James H. Herbert, II Chairman and Chief Executive Offi cer (Founding) Michael D. Selfridge Chief Banking Offi cer Jason C. Bender Chief Operating Offi cer Hafi ze Gaye Erkan Chief Deposit Offi cer and Chief Investment Offi cer Mollie M. Richardson Chief Administrative Offi cer Bob Thornton President Private Wealth Management Consistently Profitable Since Inception / 1985 –2015 In addition to a strong 2015, results over the fi ve and a half years since we have been independent again have been strong. Since July 1, 2010, core earnings per share have grown 16% per annum and tangible book value per share has also grown 16% per annum. Stability: • Consistent Leadership • Stable Client Relationships • Organic Expansion Shareholder Value Creation: • Enterprise Valuation 08/86: $23 Million • Enterprise Valuation 12/15: $10 Billion • Enterprise Value Growth Since 1986: 23% Per Annum Compound Annual Growth Rate / 2010 –2015 CORE EARNINGS PER SHARE Annual Percentage Increase +16% TANGIBLE BOOK VALUE PER SHARE Annual Percentage Increase +16% $ 0.71 $ 3.02 $ 13.39 $ 30.16 2010 – 2015 2010 – 2015 CAGR for the period was calculated based on annualized core EPS for the six months ended December 31, 2010. CAGR computed over 5.5 years since July 1, 2010. FRC Total Return Since Buyback: 7/1/10 –12/31/15* COMPOUND ANNUAL GROWTH RATE * Chart period of 5.5 Years +32% $ 70 $ 60 $ 50 $ 40 $ 30 $ 20 $ 10 FRC Repurchase 7/1/10 $15.00 / share IPO #2 12/8/10 $25.50 / share 12/31/15 $66.06 / share 7/1/10 12/31/10 12/31/11 12/31/12 12/31/13 12/31/14 12/31/15 6. 7. Client Index C AT E G O R Y / I N D U S T R Y C L I E N T Entrepreneur Noah Lichtenstein Arts Helgi and Marlene Tomasson Personal Banking / Private Equity Marc and Marjorie McMorris Real Estate Stephen M. Ross Personal Banking / Medical Christina Pham, m.d. and Johannes Kratz, m.d. Financial Services West Rhode & Roberts Certified Public Accountants Private Equity Portfolio Advisors, llc Personal Banking / Business Banking Santo Politi and Eleanor Gray Baldwin Tech / Entrepreneur Apoorva Mehta Law Firm Gilmartin Magence llp Nonprofit / Tech CODE2040 Independent School Oregon Episcopal School P A G E 12 14 16 18 20 22 24 26 28 30 32 34 C AT E G O R Y / I N D U S T R Y C L I E N T Nonprofit Massachusetts Historical Society Entrepreneur Richelieu Dennis Personal Banking / Medical Shahin Ghadir, m.d. Independent School French American International School Wine Industry James Harder and Jim Regusci Architecture / Design Nancy and Jeffery Smith Personal Banking / Medical Kiandra Kang, m.d. Personal Banking Thomas C. Quick Personal Banking Josh Latson Aviation Jet Support Services, Inc. ( JSSI) Personal Banking and Brokerage* Ed and Peggy Kavounas P A G E 36 38 40 42 44 46 48 50 52 54 56 8. 9. * Brokerage services are off ered through First Republic Securities Company, LLC, Member FINRA/SIPC. Strength, service and stability. Our clients say it best. Noah Lichtenstein S A N F R A N C I S C O , C A L I F O R N I A Noah Lichtenstein Venture Partner, Cowboy Ventures “ First Republic goes above and beyond to help me get what I need when I need it.” For entrepreneur turned venture capitalist Noah Lichtenstein, banks had always been stale, cold institutions where his money sat until he needed it. When he moved to First Republic, he was delighted to be treated as an individual. He had no complicated banking needs until he lost his wallet, including his ATM card, on a trip abroad. After one quick call to his personal banker, a replacement ATM card was on its way to Spain. It was then that he realized the power of strong client service. Noah’s business is founded on relationships and a reputa- tion for being helpful. With First Republic, he has found a bank that mirrors his own values. 12.12. Helgi and Marlene Tomasson S A N F R A N C I S C O , C A L I F O R N I A Helgi Tomasson Artistic Director and Principal Choreographer, San Francisco Ballet Marlene Tomasson Former Dancer, Wife and Mother “ First Republic takes extraordinary care of our accounts and those of the San Francisco Ballet, providing flawless service.” Since 1985, Icelandic-born Helgi Tomasson has been the Artistic Director of the world-renowned San Francisco Ballet. Drawing on his experience as an internationally renowned dancer, he has helped establish the San Francisco Ballet as one of the premier dance companies in the world. He and his wife, former dancer Marlene Tomasson, travel extensively and rely on the Bank to pro- vide the support they need while they are away. And the Ballet relies on First Republic’s business banking team to meet its operational needs. With First Republic, their fi nances are always perfectly in step. 15. Marc and Marjorie McMorris T I B U R O N , C A L I F O R N I A Marc McMorris Co-Founder and Director, Carrick Capital Partners Marjorie McMorris Founder and Director, Th e Helix School Foundation “ First Republic handles both our banking and brokerage needs. Having one institution that knows and understands us is extremely valuable.” Marc and Marjorie McMorris lead busy lives as professionals and parents. Marc helps technology-enabled companies grow through strategic investments via the fund he co-founded. And Marjorie is Founder and Director of The Helix School, which tailors its curricu- lum for students with Autism Spectrum Disorder. When they came to First Republic, they fi nally found a bank that could meet all of their fi nancial needs. Their lives are now better coordinated, leaving them more time to focus on what matters most to them. * Please see bottom of page 63 for important information related to the provision of brokerage services. Investment performance may vary by client. 16.16. Stephen M. Ross N E W Y O R K , N E W Y O R K / P A L M B E A C H , F L O R I D A Stephen M. Ross Chairman and Founder, Related Companies “ First Republic is a bank that stands out and takes great care of their clients. Th ey are there whenever I need them.” Stephen Ross is Chairman and Founder of Related Companies — one of the most prominent real estate development companies in the country — and majority owner of the Miami Dolphins. His company employs over 3,000 professionals and he is committed to surround- ing himself with the brightest people possible. His choice of First Republic for personal and business banking is consistent with his extraordinary commitment to excellence. That consistent quest for excellence is just one reason he was recently named the most powerful person in New York real estate. 19. Christina Pham, m.d. and Johannes Kratz, m.d. S A N F R A N C I S C O , C A L I F O R N I A Christina Pham, m.d. UCSF Medical Center Johannes Kratz, m.d. UCSF Medical Center “ When we found we could refi nance our student loans with our First Republic personal banker, we jumped at the chance.” Christina Pham and Johannes Kratz, parents to three young children and doctors at UCSF Medical Center, were thrilled to discover a new standard of banking when they became First Republic clients in 2012. Having always considered banking a chore, Christina and Johannes fi nd First Republic’s customized approach a refreshing change. No matter what they need, they know that their dedicated team is just an email, text or phone call away. Focusing on their young family and juggling demanding work schedules, the couple relies on a strong support network of family, friends — and now First Republic — to keep them moving forward. 21. West Rhode & Roberts Certified Public Accountants S A N D I E G O , C A L I F O R N I A Christopher M. Roberts, cpa Partner Cheryl M. Rhode, cpa Partner “ First Republic provides exceptional service. Th ey are the right fi t for us and are able to meet the complex needs of clients.” Accounting fi rm West Rhode & Roberts was looking for a bank that understood the unique challenges of working with diff erent busi- ness categories. When they learned of First Republic’s reputation for extraordinary service, they knew they would be in particularly good hands. West Rhode & Roberts is delighted with the Bank and the service they receive from their business banker. When asked by their clients to recommend a fi nancial institution, the fi rm confi - dently refers First Republic. 22.22. Portfolio Advisors, llc D A R I E N , C O N N E C T I C U T (starting fr om far left ) Jesse Eisenberg General Counsel and Managing Director Charles Harper Managing Director Jenifer Parker Chief Financial Offi cer Brian Murphy Managing Member and Managing Director William Indelicato Managing Director Elizabeth Campbell Senior Vice President Kenneth Wisdom Managing Director “ First Republic’s professional loan program helped us free up capital for strategic initiatives.” Portfolio Advisors is an independent, employee-owned fi rm that provides tailored private equity, private real estate and private credit investment solutions. With offi ces in the United States, Europe and Asia, the fi rm has established a global footprint. And more than 900 limited partners have invested in various Portfolio Advisors sponsored funds. Known for providing customized investment solutions, the fi rm respects First Republic’s creative and entrepreneurial approach to banking. The relationship extends beyond business banking to include the fi rm’s professionals. The majority of professionals who participate in Portfolio Advisors’ general partnership vehicles have taken advantage of the Bank’s professional loan program. 25. Santo Politi and Eleanor Gray Baldwin M A N C H E S T E R - B Y- T H E - S E A , M A S S A C H U S E T T S Santo Politi Co-Founder and General Partner, Spark Capital Eleanor Gray Baldwin Owner, New England Garden Ornaments “ Our banking needs run the spectrum. First Republic’s service and delivery have been perfect on all fronts.” Importing antique stone artifacts from Europe, running a successful venture capital fi rm, renovating a 100 year-old home, and raising two daughters — Santo Politi and Gray Baldwin’s business and personal lives are busy, varied and interesting. Since 2008, the couple has worked with First Republic to fulfi ll their incredibly diverse banking needs. From foreign exchange to personal banking, construction loans to business services, the relationship has developed, but the level of responsiveness and commitment they receive has never changed. With First Republic, they have a strong fi nancial founda- tion on which to build their lives. 27. Apoorva Mehta S A N F R A N C I S C O , C A L I F O R N I A Apoorva Mehta Founder and CEO, Instacart “ As a personal banking client, I experienced great service. When the time came to open a business account, First Republic was the natural choice.” Apoorva Mehta had always dreamed of starting his own company. His entrepreneurial drive and experience paid off when, in 2012, he established Instacart. The online grocery delivery service now op- erates in 18 metropolitan areas and partners with over 100 retailers. Apoorva already had a personal account with First Republic and, when the time came to open business accounts, he didn’t need to shop around. He wanted a business bank that off ered extraordinary service and First Republic delivers just that. 29. Gilmartin Magence llp B O S T O N , M A S S A C H U S E T T S Craig P. Gilmartin (left ) Senior Partner Yitz Magence (right) Senior Partner “ We have nothing but glowing things to say about the Bank–their focus on client service is extraordinary.” Established in 1996 as a residential real estate law fi rm, Gilmartin Magence has since evolved into a boutique law fi rm specializing in commercial and residential real estate and business law. Partners Craig Gilmartin and Yitz Magence were thrilled each time their cli- ents worked with First Republic on a deal as they knew the process would run smoothly. Their experience working with First Republic professionally convinced them to move their own banking relation- ship over. To their delight, the transition was seamless. Shared values — including a commitment to client service, responsiveness and action — have helped the Bank build a strong relationship with Gilmartin Magence. 31. CODE2040 S A N F R A N C I S C O , C A L I F O R N I A Laura Weidman Powers Co-Founder and CEO Tristan Walker Co-Founder and Board Chair “ We know most banks wouldn’t put any energy into a nonprofi t startup. First Republic is diff erent–they make all clients feel valued.” CODE2040 is a unique nonprofi t founded in San Francisco in 2012. They use the city’s strong links to the tech industry to open the doors to educational, professional and entrepreneurial success for underrepresented minorities. To date, they’ve worked with 70 Bay Area tech companies and have placed over 150 Fellows. When looking for a bank for their business, Laura Weidman Powers knew exactly what they needed. She had recently become a personal banking client of First Republic and particularly valued the high level of service and support. As CODE2040 has grown, they’ve benefi ted from First Republic’s extensive experience and valuable insight into the world of nonprofi ts. It’s just one of the things that helps keep them reaching for the top. 33. Oregon Episcopal School P O R T L A N D , O R E G O N Mo Copeland Head of School “ First Republic’s understanding of independent schools is impressive. Th eir knowledge and guidance is helping us secure the future of our school.” Oregon Episcopal School has spent the last 150 years helping to develop and educate young, inquiring minds. With 60 international boarders among its students, the school embraces diversity and a range of cultures and perspectives. Having a bank that under- stands the benefi t of shared perspectives has been a big plus. First Republic’s experience working with independent schools and their unique fi nancial needs has been of equal benefi t. With First Republic, Oregon Episcopal School can manage its business with a true banking partner. 34.34. Massachusetts Historical Society B O S T O N , M A S S A C H U S E T T S Dennis A. Fiori (left ) President Charles C. Ames (right) Chair, Board of Trustees “ With the help of First Republic, we’re keeping our nation’s history alive.” The Massachusetts Historical Society is the oldest such organi- zation in the U.S., dating back to the 18th century. The Society is a center of research and learning, dedicated to deepening the under- standing of the American experience. When parts of the landmark building needed to be repaired, First Republic was on hand with a tax-exempt loan to ensure the essential work could be carried out. With its precious documents and artifacts safely housed, the Society can focus on bringing history to life, just as it has since 1791— as knowledge of the past is fundamental to the future. 37. Richelieu Dennis A M I T Y V I L L E , N E W Y O R K Richelieu Dennis Founder and CEO, Sundial Brands “ First Republic has tailored their approach around my work style. I can do my banking with an actual person–and that is invaluable.” Richelieu Dennis is the driving force and vision behind Sundial Brands, the family business inspired by his grandmother, a village merchant and healer in her native Sierra Leone. The company has won awards for its use of high-quality, natural ingredients in its skin and hair care products, and plaudits for creating opportuni- ties for long-term economic empowerment and sustainability via its purpose-driven Community Commerce business model. Since 1991, passion, legacy and love have marked Sundial’s progress as one of the fastest-growing private companies in the United States. A good friend recommended First Republic in 2013. Now Richelieu relies on his banker to help him achieve his fi nancial goals and to work towards Sundial’s purpose of empowering people to live more beautiful lives. 38.38. Shahin Ghadir, m.d. B E V E R LY H I L L S , C A L I F O R N I A Shahin Ghadir, m.d., f.a.c.o.g. Founding Partner, Southern California Reproductive Center “ I feel very fortunate with First Republic–they make banking an enjoyable process.” Dr. Shahin Ghadir loves what he does. As a fertility specialist, he has played an integral part in helping thousands of people achieve their dreams of starting a family. When he needed to move quickly to secure the ideal home for his own young family, First Republic immediately helped him on his journey. His real estate agent con- nected him with a personal banker, who has since become a close friend and reliable fi nancial touchstone. He knows that the Bank is with him and will continue to support and help him — just as he sup- ports his patients. 41. French American International School S A N F R A N C I S C O , C A L I F O R N I A Melinda Bihn, Ed.D. Head of School Aaron J. Levine CFO and Director of Operations “ With First Republic, you can talk to a human being and get a straight answer. Th ey’re utterly focused on client service.” For over 50 years, French American International School of San Francisco has delivered a rigorous bilingual education program to its students. Growing from a two-room elementary school in 1962 to the multi-campus, pre-kindergarten through 12th grade school it is today took vision, focus, determination, and a bank that was inter- ested in more than dollars and cents. With First Republic’s support, the school can concentrate on helping over 1,070 students be their very best selves — now and in the future. 43. James Harder and Jim Regusci N A P A , C A L I F O R N I A James Harder (left ) Owner, James Cole Winery, T-Vine Winery, Tank Garage Winery Jim Regusci (right) Owner, Regusci Winery, T-Vine Winery, Tank Garage Winery “ We had never liked the banking part of business until we met First Republic. Everyone here knows us and knows what’s important to us.” James Harder and Jim Regusci are fi rm believers in the power of teamwork. When they fi rst met in 2000, they realized they shared a vision for developing and growing their wine businesses. Since then, they’ve worked on a number of successful joint ventures. Jim had already worked with First Republic and, when he introduced James to the Bank, a vintage relationship was formed. With First Republic, Jim and James have found a bank that truly understands and sup- ports the wine industry. 44.44. Nancy and Jeffery Smith P A L M B E A C H , F L O R I D A Nancy Smith Mother, Interior Designer and Community Volunteer Jeffery Smith President, Smith Architectural Group “ Our relationship with First Republic is truly personal. Th ey understand who we are and what we need.” Longtime Palm Beach residents Nancy and Jeff ery Smith have a true appreciation of community. The couple gives back by donating their time and design expertise to help preserve the icons of Palm Beach. Nancy and Jeff also appreciate the personal relationship that they have with their banking team at First Republic — a relationship rooted in trust and security. They know that, whenever they have a question or request, they can simply pick up the phone and get a quick response. Whether they need foreign currency for a trip abroad or support for Jeff ’s business accounts, they know First Republic can accommodate their needs. Photographed at the Flagler Kenan Pavilion. Designed by Smith Architectural Group on a pro-bono basis for the Flagler Museum. 46.46. Kiandra Kang, m.d. L O S A N G E L E S , C A L I F O R N I A Kiandra Kang, m.d. Kindercare Pediatrics Pictured with Quinn “ I love the personalized service at First Republic. Th ey put my needs fi rst and make things easy for me.” Dr. Kiandra Kang completed her pediatric residency at UCLA and practices in Los Angeles. She enjoys working closely with parents to help their children develop into healthy, happy adults. Dr. Kang heard about First Republic through a fi nancial advisor at her residency program and was interested in learning more about refi nancing her student loans. She met with a banker and immediately felt comfort- able with the client-centric approach and high level of personalized service she received. 49. Thomas C. Quick P A L M B E A C H , F L O R I D A / N E W Y O R K , N E W Y O R K Thomas C. Quick Retired Vice Chairman, Fleet, Quick & Reilly, Inc. “ First Republic’s client service surpasses other banks. Th ey are welcoming and client-oriented.” Thomas C. Quick spent his career leading a national stock brokerage fi rm, and understands what personalized service is all about. Tom splits his time between Palm Beach and New York, and serves on many nonprofi t boards in each city. He is dedicated to philan- thropy, with a focus on education and medical research. When Tom became a First Republic client in 2014, the Bank’s focus on extraordinary client service really impressed him. And that has led to a much expanded relationship. 50.50. Josh Latson B O S T O N , M A S S A C H U S E T T S Josh Latson Special Assistant to the COO, Boston Medical Center “ Refi nancing my student loans with First Republic has allowed me to be more flexible when thinking about future job opportunities.” With a background in fi nance, an immediate return to Wall Street or a foray into consulting may have been a natural career step for Josh Latson. But returning to school for his MBA gave him the time to consider what he’s passionate about — and his decision to take a fellowship in the healthcare industry at a nonprofi t meant a revision of his salary expectations. By refi nancing his student loans with First Republic, Josh has been able to reduce his monthly payments and focus on saving more for future endeavors, including buying a home. He appreciates the level of professionalism, timeliness and responsiveness his banker showed him throughout the process and looks forward to a continued relationship with First Republic. 53. Jet Support Services, Inc. ( JSSI) C H I C A G O , I L L I N O I S Neil W. Book President and CEO (left ) Robert H. Book Chairman (right) “ Aft er our fi rst conversation with our banker, we knew First Republic was a diff erent kind of bank.” Jet Support Services, Inc. (JSSI) is the world’s largest supplier of maintenance programs to the business aviation industry, with over 1,800 aircraft enrolled in their programs. Across 77 countries, JSSI’s programs allow customers to stabilize their budgets while increasing the residual value of their aircraft. Customer service is at the heart of what they do. So, when Neil and Bob Book met with First Republic, they were immediately impressed with the team’s commitment to service. Since then, the relationship with First Republic has expanded beyond checking to include foreign exchange, cash management and investments, as well as a rela- tionship with First Republic’s Aviation Finance team. * Please see bottom of page 63 for important information related to the provision of brokerage services. Investment performance may vary by client. 55. The Kavounas Family S A N F R A N C I S C O , C A L I F O R N I A Ed Kavounas Peggy Kavounas “ Our First Republic banker and broker know us well. We’ve been working with the same team for years now and value the personalized service.” Banking is a family aff air for Ed and Peggy Kavounas. Ed, a founder of Rockwood Capital, and Peggy, a retired nonprofi t director and fi lm- maker, serve actively on boards and travel often to see friends and family — including their three sons and eight grandchildren. Advo- cates of the personal attention they’ve received from the Bank, the couple suggested that each of their sons open accounts as well, expanding their family presence at First Republic. Their banker and broker handle their most critical fi nancial needs personally. And the Bank helps guard against fraud by providing cyber security checks at home. They appreciate working with people who know them and who make things easier for them. * Please see bottom of page 63 for important information related to the provision of brokerage services. Investment performance may vary by client. 57. Contents 60 Private Banking and Wealth Management 62 Complete Products and Services 65 Consolidated Statement of Income 66 Consolidated Balance Sheet 68 Additional Information 70 Proudly Investing in Our Communities 74 First Republic Values 76 Board of Directors 78 Locations “Our goal is service quality at the highest possible level.” Jim Herbert Chairman and CEO (Founding) 58. Full-Service Private Banking, Private Business Banking and Private Wealth Management A R Y D I N R O A R T X E S E R V I C E T H R O U GH PERSONAL & DIGITATT L C H A N N E L S Residential Lending Personal Lending Commercial Real Estate Lending F U L L - S E R V C E I P R I V V AA A T E Y O U R F I R A N D S T CLIENT B U S I N R E P U E S S BLIC R E L A T I B A N KING R E G A N A M H IP TAA R I V AV P W E S N O Checking, Savings, CDs (Deposits) Business Banking Trust Services Financial Planning T N E M E G A N A M H T LL L A E Investment Management Foreign Exchange Brokerage Services Private Banking First Republic bankers work directly with each of our clients and focus on both sides of the client’s balance sheet to provide direct access to all bank services and personally refer clients to our wealth management affi liates when appropriate. At First Republic, we build long-term, rewarding relationships with our clients. A distinctive brand of Private Banking: • Our approach to clients is based on advice and solutions — not products. • We off er full-service banking on both coasts, including convenient Banking Online, fl exible Bill Pay and no access fees at virtually all ATMs around the world. With our ATM Rebate Checking account, we even rebate access fees charged by other banks whenever our clients use their ATMs. • We keep fi nancial safety and privacy at the forefront. • We believe in frequent, personal contact. Our bankers get to know our clients and are easy to reach. • Our primary source of new clients is through referrals from satisfi ed existing clients. Private Business Banking Our professional business bankers provide the same personalized and highly-responsive service to the business community as we do to personal banking clients. Th at’s why we call it Private Business Banking. Specialized services off ered for: • Accounting Firms • Law Firms • Architecture and Design Firms • Medical Practices • Real Estate Investors • Small Businesses • Business Management Firms • Motion Picture and TV Production • Technology Firms • Engineering Services • Family Offi ces • Nonprofi ts • Private Clubs • Venture Capital Funds/Firms • Wineries • Independent Nonprofi t Schools • Private Equity Funds/Firms • Investment Firms • Property Management Firms Private Wealth Management First Republic Private Wealth Management affi liates off er customized investment management, trust and brokerage services for individuals, trusts, endowments and organizations. In addition to traditional portfolio management, the affi liates also employ carefully screened outside managers for equity, fi xed income and alternative investments. Wealth Management services include: • Portfolio Management • Trust Administration and Custody • Financial and Estate Planning • Insurance Services • Manager Selection • Comprehensive Brokerage Services Banking products and services are provided by First Republic Bank, Member FDIC and Equal Housing Lender Investment Advisory services are provided by First Republic Investment Management, Inc. Trust services are provided by First Republic Trust Company and First Republic Trust Company of Delaware LLC. Brokerage services are off ered through First Republic Securities Company, LLC, Member FINRA/SIPC. Insurance services are provided through First Republic Securities Company, LLC, Member FINRA/SIPC, DBA Grand Eagle Insurance Services, LLC, CA Insurance License # 0I13184. Investment, Insurance and Advisory Products and Services are Not FDIC Insured, Not Guaranteed and May Lose Value. 61. Complete Products and Services Residential Lending • Single Family Mortgages • Vacation Home Mortgages • Home Equity Lines of Credit • Bridge Loans • Co-op and Condominium Loans • All-in-One, Construction-to-Permanent Loans Commercial Real Estate Lending Personal Lending Private Business Banking • Apartment Building Loans • Mixed-use Building Loans • Commercial Real Estate Loans • Construction and Renovation Loans • Stock/Bond Secured Loans • Unsecured Loans • Student Loan Refi nancing (Eagle Gold All-in-One)* • Streamlined Loans and Lines of Credit • Loan Program for Employee Capital Call (Eagle Gold) and Partnership Buy-ins • Overdraft Lines of Credit • Aircraft and Marine Financing • Lines of Credit • Term Loans • Mobile Banking • Corporate Online Banking and Bill Pay • Lending to Nonprofi ts • Business Interest Checking • Owner-User Commercial Real Estate Loans • Business Analyzed Checking • Streamlined Small Business Lending • Business Money Market Accounts (Eagle One) • Capital Call Lines • Attorney Trust Accounts (IOLTA, IOTA, IOLA) • Business Debit Card • Loan Program for Employee Capital Call • Armored Car/Cash Services and Partnership Buy-ins • Standby Letters of Credit • Foreign Exchange • Aircraft and Yacht Financing • Winery and Vineyard Lending • Multi-Client Management Accounts • Custody and Business Escrow Services • Free Business On-site ATMs • Remote Deposit Services • Lockbox Services Nationwide • Motion Picture and TV Financing • Funds Transfer and ACH Services • Simplifi ed Business Checking • Positive Pay and Payee Positive Pay Services Deposit Services • ATM Rebate Checking** • Classic Checking • Money Market Checking • Money Market Savings • Passbook Savings • Certifi cates of Deposit • Traditional, Roth and SEP IRAs • Banking Online • Online Bill Pay • Mobile Banking and Mobile Check Deposit • Foreign Exchange * This product is not an education loan and may remove federal privileges and benefi ts associated with existing student loans. ** Domestic and foreign country ATM access fees are rebated at the end of the monthly cycle. Foreign currency conversion and other usage fees vary by country and network and are not included in the rebated ATM access fees. Investment Management Services Brokerage Services Trust Services Insurance Services • Equity Management • Fixed Income Management • Alternative Investments: Private Equity, Private Real Estate, Credit, Special Situations and Hedge Funds* • Cash Management • Endowment Investment Management and Consulting • Financial Planning • Environmental, Social and Governance Investing • 401(k) Plan Management • Full-Service and Self-Directed Brokerage Services • Equities and Mutual Funds • Money Market Mutual Funds • Treasury Bills/Bonds • Agency Discount Notes • Municipal Notes/Bonds • Corporate Bonds • Brokerage CDs • Personal Trust Services with Open Architecture • Trustee of Revocable, Irrevocable and Testamentary Trusts • Estate Settlement/Executor Services • Commercial Paper • Margin Loans • Equity Compensation Plans • 10b5-1 Plans for Corporate Executives • Hedging Strategies for Concentrated Stock Positions • Online Brokerage • FDIC-Insured Sweep Accounts • Option Exercise Programs • Custody Services • Business Escrow Services • Independent and Objective Reporting • Delaware Trust Offi ce • Open Architecture Access to Top Carriers • Private Placement Life and Annuity Products, and Best-in-Class Products off ering Alternative Investments • Permanent Life Insurance Products for • Disability Products for High-Income Executives Estate, Business Planning and Tax-Deferred Cash Accumulation and Professional Services Firms • Specialty and Hybrid Long-Term Care Products Investment Advisory services are provided by First Republic Investment Management, Inc. Trust services are provided by First Republic Trust Company and First Republic Trust Company of Delaware LLC. Brokerage services are off ered through First Republic Securities Company, LLC, Member FINRA/SIPC. Insurance services are provided through First Republic Securities Company, LLC, Member FINRA/SIPC, DBA Grand Eagle Insurance Services, LLC, CA Insurance License # 0I13184. * These products are off ered to clients who meet certain eligibility and suitability requirements. Investment, Insurance and Advisory Products and Services are Not FDIC Insured, Not Guaranteed and May Lose Value. 62. 63. Financial Summary / 2015 Consolidated Statement of Income in thousands, except per share amounts YEAR EN DED DECEMBER 31 2 015 2 014 2 013 Interest income: Loans Investments Other Cash and cash equivalents Total interest income Interest expense: Deposits Borrowings Total interest expense Net interest income Provision for loan losses Net interest income after provision for loan losses Noninterest income: Investment management fees Brokerage and investment fees Trust fees Foreign exchange fee income Deposit fees Gain on sale of loans Loan servicing fees, net Loan and related fees Income from investments in life insurance Gain on investment securities, net Other income Total noninterest income Noninterest expense: Salaries and employee benefits Occupancy Information systems Professional fees FDIC assessments Advertising and marketing Amortization of intangibles Other expenses Total noninterest expense Income before provision for income taxes Provision for income taxes Net income Dividends on preferred stock Net income available to common shareholders Basic earnings per common share Diluted earnings per common share Dividends per common share Weighted average shares — basic Weighted average shares — diluted $ 1,361,654 268,682 27,464 6,292 1,664,092 61,072 86,357 147,429 1,516,663 55,439 1,461,224 178,738 19,659 10,745 22,517 19,311 9,725 13,040 12,393 35,474 821 2,630 325,053 596,593 106,856 119,114 73,022 35,250 25,562 21,760 117,452 1,095,609 690,668 168,523 522,145 58,928 $ 463,217 $ $ $ 3.27 3.18 0.59 141,689 145,510 $ 1,271,562 189,630 18,106 3,711 1,483,009 60,454 91,795 152,249 1,330,760 56,486 1,274,274 147,840 14,404 10,483 19,552 18,468 35,515 9,701 8,658 29,558 21,837 2,339 318,355 490,341 98,466 95,387 53,429 31,294 25,703 22,744 105,382 922,746 669,883 182,877 487,006 55,556 $ 431,450 $ $ $ 3.16 3.07 0.54 136,420 140,497 $ 1,193,931 150,193 8,893 3,001 1,356,018 60,817 71,026 131,843 1,224,175 36,969 1,187,206 112,121 11,892 9,588 13,912 18,258 36,290 7,230 7,515 24,365 531 2,648 244,350 402,222 91,120 79,955 22,488 27,976 25,459 26,147 92,630 767,997 663,559 201,489 462,070 40,671 $ 421,399 $ $ $ 3.21 3.10 0.36 131,326 135,949 See notes to consolidated fi nancial statements in our Annual Report on Form 10-K. 65. Consolidated Balance Sheet dollars in thousands Assets AS OF DECEMBER 31 2 015 2 014 AS OF DECEMBER 3 1 2 015 2 014 Liabilities and Equity Cash and cash equivalents Securities purchased under agreements to resell $ 1,131,110 $ 817,150 100 100 Investment securities: Investment securities available-for-sale Investment securities held-to-maturity Total investment securities Loans: Single family (1-4 units) Home equity lines of credit Multifamily (5+ units) Commercial real estate Single family construction Multifamily/commercial construction Business Other secured Stock secured Unsecured loans and lines of credit Total loans Less: Net unaccreted discount Net deferred costs Allowance for loan losses Loans, net Loans held for sale Investments in life insurance Tax credit investments Prepaid expenses and other assets Premises, equipment and leasehold improvements, net Goodwill Other intangible assets Mortgage servicing rights Total Assets See notes to consolidated fi nancial statements in our Annual Report on Form 10-K. 2,910,801 7,540,678 10,451,479 23,092,346 2,370,188 5,371,484 4,462,834 436,774 693,364 6,232,378 541,637 521,005 423,795 44,145,805 (108,499) 46,263 (261,058) 1,393,357 5,244,707 6,638,064 20,494,402 2,211,621 4,689,692 3,824,835 428,358 453,732 4,873,580 436,918 285,240 231,552 37,929,930 (152,764) 31,203 (207,342) 43,822,511 37,601,027 48,681 1,168,596 1,006,836 817,410 172,008 171,616 137,400 53,538 271,448 1,014,734 828,640 747,763 165,703 106,549 110,001 49,023 $ 58,981,285 $ 48,350,202 Liabilities: Deposits: Noninterest-bearing checking Interest-bearing checking Money market checking Money market savings and passbooks Certificates of deposit Total deposits Securities sold under agreements to repurchase Long-term FHLB advances Senior notes Debt related to variable interest entities Other liabilities Total Liabilities Shareholders’ Equity: Preferred stock, $0.01 par value per share; 989,525 and 889,525 shares issued and outstanding Common stock, $0.01 par value per share; 146,109,790 and 138,268,849 shares issued and outstanding Additional paid-in capital Retained earnings Accumulated other comprehensive income (loss) Total Shareholders’ Equity Total Liabilities and Shareholders’ Equity $ 18,252,007 12,027,363 5,756,821 7,270,396 4,586,878 $ 12,542,881 8,809,590 5,216,253 6,795,18 9 3,767,016 47,893,465 37,130,929 100,000 4,000,000 397,159 29,643 855,335 — 5,275,000 396,384 36,039 733,383 53,275,602 43,571,735 989,525 889,525 1,461 2,770,265 1,949,652 (5,220) 5,705,683 1,383 2,313,592 1,570,871 3,096 4,778,467 $ 58,981,285 $ 48,350,202 66. 67. First Republic Common and Preferred Stock First Republic Bank’s Common Stock is traded on the New York Stock Exchange (“NYSE”) under the symbol FRC. At December 31, 2015, the Bank believes that its shares are held benefi cially by approximately 95,000 shareholders. First Republic Bank’s issues of Preferred Stock trade as depositary shares on NYSE under the symbols FRCPrA for the Series A, FRCPrB for the Series B, FRCPrC for the Series C, FRCPrD for the Series D, FRCPrE for the Series E, FRCPrF for the Series F and FRCPrG for the Series G. Additional Information and Where to Find it In accordance with the Securities Exchange Act of 1934 (the “Exchange Act”), First Republic files annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements for the annual meeting of shareholders and other information with the FDIC, copies of which are available on the FDIC website at https://efr.fdic.gov/fcxweb/efr/index.html, in the Investor Relations section of our website at http://www.fi rstrepublic.com or upon written or telephone request to us at the following address: First Republic Bank Investor Relations, 111 Pine Street, San Francisco, CA 94111, (415) 392-1400. Forward-Looking Statements Th is document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements in this document that are not historical facts are hereby identifi ed as “forward-looking statements” for the purposes 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. Th ese statements are oft en, 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 diff er materially from those expressed in them. Factors that could cause actual results to diff er from those discussed in the forward-looking statements include, but are not limited to: signifi cant competition to attract and retain banking and wealth management customers; projections of loans, assets, deposits, liabilities, revenues, expenses, tax liabilities, net income, capital expenditures, liquidity, dividends, capital structure or other fi nancial items; expectations regarding the banking and wealth management industries; the possibility of earthquakes and other natural disasters aff ecting the markets in which we operate; interest rate risk and credit risk; descriptions of plans or objectives of management for future operations, products or services; our ability to maintain and follow high underwriting standards; forecasts of future economic conditions generally and in our market areas in particular, which may aff ect the ability of borrowers to repay their loans and the value of real property or other property held as collateral for such loans; the geographic concentration of our operations; our opportunities for growth and our plans for expansion (including opening new offi ces); expectations about the performance of any new offi ces; demand for our products and services; projections about loan premiums or discounts and about the amount of intangible assets, as well as amortization of recorded amounts; future provisions for loan losses, changes in nonperforming assets, impairment of investments and our allowance for loan losses; projections about future levels of loan originations or loan repayments; projections regarding costs, including the impact on our core effi ciency ratio; the regulatory environment in which we operate, our regulatory compliance and future regulatory requirements, including potential restrictions as a de novo institution; the phase-in of the fi nal capital rules regarding the Basel Committee’s “Basel III” December 2010 framework, changes to the defi nitions and components of regulatory capital and a new approach for risk-weighted assets; legislative and regulatory actions aff ecting us and the fi nancial services industry, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act, including increased compliance costs, limitations on activities and requirements to hold additional capital; the impact of new accounting standards; future Federal Deposit Insurance Corporation special assessments or changes to regular assessments; our ability to successfully execute on initiatives relating to enhancements of our technology infrastructure, including client-facing systems and applications; and descriptions of assumptions underlying or relating to any of the foregoing. For a discussion of these and other risks and uncertainties, see the risk factors in our 2015 Annual Report on Form 10-K and any subsequent reports fi led by First Republic under the Exchange Act. Th ese fi lings are available in the Investor Relations section of our website. In addition, some of the fi nancial information provided in this Annual Report includes non-GAAP fi nancial measures. Th e fi lings available on the Investor Relations section of our website present reconciliations to the appropriate GAAP measures and explains why we believe such measures are useful to investors. All forward-looking statements are necessarily only estimates of future results, and there can be no assurance that actual results will not diff er 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 refl ect events or circumstances aft er the date on which the statement is made or to refl ect the occurrence of unanticipated events. 68. 69. Proudly Investing in Our Communities • Affordable Housing • Financial Literacy • Children • Education • Community Service • Health and Welfare • The Arts At First Republic, giving back to our communities is a part of who we are. Since 1985, we have consistently contributed time, support, guidance and money to nonprofi t organizations across the country–helping them provide essential services to those who need them most. We salute their dedication and delight in watching these organizations make a meaningful impact in their communities. Join us in celebrating three, among many, such outstanding organizations with which we have the privilege of working. Operation HOPE N AT I O N W I D E A N D G L O B A L Since 1994, we have supported Operation HOPE, the leading global provider of fi nancial literacy and economic education programs for low- and moderate-income youth and families in underserved communities. Founded in 1992 by John Hope Bryant (upper right above) with the mission to eradicate poverty and establish “silver rights”— the right to fi nancial literacy, access to capital, and equity of opportunity for the underserved —Operation HOPE has aided over 2.5 million indi- viduals and directed more than $1.8 billion in private capital. As a HOPE Partner, First Republic supports Project 5117— a multi-year, four-pronged approach to combating economic inequality and creating economically stabilized communities. Through this initiative, HOPE is helping young people learn how to take control of their fi nancial futures and empowering adults through programs that raise credit scores, encourage entrepreneurialism and facilitate homeownership. Around the world, Operation HOPE is converting check-cashing customers into banking customers, renters into homeowners, small business dreamers into small business owners, and minimum wage workers into living wage workers. 71. Quantum House W E S T PA L M B E A C H , F L O R I D A Urban Solutions S A N F R A N C I S C O , C A L I F O R N I A Opened in 2001, Quantum House serves families whose children are receiving treatment for serious medical conditions Urban Solutions helps build and revitalize healthy, sustainable communities by supporting small business owners in in Palm Beach County. Quantum House continues to be “where hope has a home” for more than 1,000 family members low- to moderate-income neighborhoods in San Francisco. The organization’s small business consulting program each year — from every state and nearly two dozen countries. The House is funded solely by generous contributions off ers clients one-on-one counseling on business plan development, fi nancial projections, and small business loan from the community. The House, which is located on the Palm Beach Children’s Hospital campus, relieves stress and fi nancial hardship by providing lodging to families during their child’s treatment. Dedicated staff ers and volunteers off er emotional support and home-cooked meals throughout each stay. Quantum House is an oasis for families after a tough day at the hospi- tal. When the families cross the threshold into the House, they become family and Quantum House becomes home. applications. Clients have access to free workshops and legal offi ce hours. A special program, Enterprising Women!, helps women of color create a legacy of economic independence. Since its start in 1992, Urban Solutions has provided services to more than 4,900 clients, and over 650 jobs have been created as a result of these small business ventures. Clients include restaurants, produce markets, beauty salons, bookstores, artists and more. Notably, after receiving services, 80% of Urban Solutions clients start a business. 72. 73. First Republic Values Do the Right Thing Provide Extraordinary Service Think Positively Move Forward, Move Fast We strive to do things right at First Republic. We also We always aim to exceed expectations and serve our We operate in an environment of trust and encourage There are two types of organizations — organizations recognize that we’re a business of humans; mistakes clients in unexpected ways. We’ll take on only what openness and fl exibility. We hire positive people who that spend time checking and organizations that will happen. Therefore, our mandate is to do the right we can do right. Our business may be about wealth act positively. Our goal is to always “manage toward yes.” spend time doing. We’re doers. We value action thing: act with integrity, own our actions, correct management and banking, but our success is all about mistakes, learn from experience. service — exceptional client service. and decisiveness and recognize that the best opportunities come to those who act quickly. Respect the Team Take Responsibility Grow Have Fun Everyone at First Republic makes a diff erence and At First Republic, it’s not enough to do our own jobs We’ve evolved greatly since our inception, expanding We know that if everyone enjoys their work, they’ll do a everyone at First Republic deserves to feel that his well. Making sure our clients are satisfi ed is everyone’s ourselves and our business purpose. At First Republic, better job — and our clients will feel the diff erence. It’s or her contribution is valued. We place high value on job. So if something needs fi xing, we step up to the we embrace change and every person has the really that simple. collaboration because we know that the power of plate, own the problem and make things right. opportunity to grow and contribute. We want our many is greater than the power of one. people to grow. 74. 75. Board of Directors James H. Herbert, ii, 71, Chairman, Chief Executive Officer (Founding) and Board Member Pamela J. Joyner, 57, Board Member Mr. Herbert founded First Republic Bank in 1985. Previously, he was the Founding President, Chief Executive Offi cer and a director of San Francisco Bancorp from 1980-1985. Mr. Herbert is a trustee of Babson College, San Francisco Ballet Association (Chair and Co-Chair, 2002-2008) and Joyce Theater of New York. He is a director of Lincoln Center for the Performing Arts and The BASIC Fund. B.S., 1966, Babson College; M.B.A., 1969, New York University. Ms. Joyner is a Founding Partner of Avid Partners LLC, a strategic marketing consulting fi rm. Previously, she held senior positions at Bowman Capital Management LLC and Capital Guardian Trust Company. She is a Trustee Emeritus of Dartmouth College and a member of the President’s Committee on the Arts and Humanities. She is a trustee of the Art Institute of Chicago, Tate Americas Foundation, and the California HealthCare Foundation, and was Co-Chair of the San Francisco Ballet Association. B.A., 1979, Dartmouth College; M.B.A., 1984, Harvard University; M.A., Honorary Degree, 2001, Dartmouth College. Katherine August-deWilde, 68, Vice Chair and Board Member Reynold Levy, 70, Board Member Ms. August-deWilde was an executive at First Republic Bank from 1985-2015. She served as President from 2007 and as COO from 1996-2014. Previously she was Senior Vice President and Chief Financial Offi cer at PMI Group. She serves on the public company boards of TriNet Group, Inc. and Sunrun, Inc. She also serves on the private company boards of Equilar, Inc. and Eventbrite. She is a member of the Advisory Council of the Stanford Center on Longevity and a member of the Stanford University Graduate School of Business Advisory Council. A.B., 1969, Goucher College; M.B.A., 1975, Stanford University. Mr. Levy is President of the Robin Hood Foundation. He was President of Lincoln Center for the Performing Arts from 2002-2013. Previously, he was President of the International Rescue Committee and an executive at AT&T. He is currently an Adjunct Professor at Columbia University’s School of International Public Aff airs and a special advisor to General Atlantic. He is a fellow of the American Academy of Arts and Sciences and Chairman of the Board of the Charles H. Revson Foundation. B.A., 1966, Hobart College; M.A., 1969, University of Virginia; Ph.D., 1973, University of Virginia; J.D., 1973, Columbia University Law School. Thomas J. Barrack, jr., 68, Board Member Jody S. Lindell, 64, Board Member Mr. Barrack is Founder and Executive Chairman of Colony Capital, Inc. Prior to the formation of Colony, he was a principal with the Robert M. Bass Group and served in the Reagan administration as Deputy Undersecretary of the Department of the Interior. He is a trustee of the University of Southern California, sits on a variety of public and private boards around the world, received an honorary doctorate from Pepperdine University in 2005 and was awarded France’s Chevalier de la Légion d’honneur by President Nicolas Sarkozy. B.A., 1969, University of Southern California; J.D., 1972, University of San Diego. Ms. Lindell is President and CEO of S.G. Management Inc., an asset management company. She is a director of the Cooper Companies and a member of its Audit and Compensation Committees. She is also a director of PDL BioPharma and a member of its Audit and Corporate Governance Committees. Until 2000, Ms. Lindell was a partner with KPMG LLP. B.A., 1973, and M.B.A., 1975, Stanford University. Certifi ed Public Accountant (inactive). Frank J. Fahrenkopf, jr., 76, Board Member Duncan L. Niederauer, 56, Board Member Mr. Fahrenkopf was President and CEO of the American Gaming Association for 18 years. He is of counsel in the Washington, D.C. law fi rm of Hogan Lovells. He is Co-Chairman of the Commission on Presidential Debates. From 1983 to 1989, he was Chairman of the Republican National Committee. He is a director of ten funds within the Gabelli Funds, LLC fund complex. He is also a director of Eldorado Resorts, Inc. B.A., 1962, University of Nevada, Reno; L.L.B., 1965, University of California, Berkeley. Mr. Niederauer served as CEO of NYSE (2007-14) and partner of Goldman Sachs. Currently he is a partner of Manikay Global Management, a fi nancial services infrastructure fund, and managing member of 555 Capital, an angel investment fund. He is a director of Realogy Holdings Corp. and Geox SpA, and sits on several additional boards, including the Congressional Medal of Honor Foundation, The American Ireland Fund and Colgate University. He and his wife Alison led the Newmark School’s “Destination of Promise” campaign to build a school for children with autism and related disabilities. B.A., 1981, Colgate University; M.B.A., 1985, Emory University. L. Martin Gibbs, 78, Board Member / Lead Outside Director George G. C. Parker, 77, Board Member Mr. Gibbs is currently an investor who retired from his law practice on January 1, 2010. He previously represented First Republic from its inception through the end of 2009 and was a partner in the law fi rm of White & Case LLP, where he had a broad-based corporate legal practice with substantial experience in mergers and acquisitions, securitizations, real estate, private equity and banking transactions. A.B., 1959, Brown University; J.D., 1962, Columbia University School of Law. Mr. Parker is the Dean Witter Distinguished Professor of Finance, Emeritus, formerly Senior Associate Dean for Academic Aff airs, Director of the MBA Program and Director of Executive Education at the Graduate School of Business, Stanford University. He serves on the board of directors of Colony Financial Company and Threshold Pharmaceuticals, Inc. B.A., 1960, Haverford College; M.B.A., Ph.D., 1967, Stanford University. Boris Groysberg, 44, Board Member Boris Groysberg is a professor of business administration in the Organizational Behavior unit at the Harvard Business School. Professor Groysberg is the author of Chasing Stars: The Myth of Talent and the Portability of Performance, and co-author of Talk, Inc.: How Trusted Leaders Use Conversation to Power their Organizations and Wall Street Research: Past, Present, and Future. He has published more than 100 articles, notes and case studies on how fi rms develop and utilize their talent, and has won numerous awards for his research on managing human capital. B.S., 1994, New York University, L. Stern School of Business; D.B.A., 2002, Harvard Business School. Sandra R. Hernández, m.d., 58, Board Member Dr. Hernández is President and CEO of the California HealthCare Foundation, an independent foundation dedicated to improving the health of the people of California. Prior to joining CHCF, she was CEO of The San Francisco Foundation, which she led for 16 years. Dr. Hernández previously served as director of public health for the City and County of San Francisco and co-chaired San Francisco’s Universal Healthcare Council. B.A., 1979, Yale University; M.D., 1984, Tufts School of Medicine; Senior Executives in State and Local Government program, Harvard University’s John F. Kennedy School of Government. Emeritus Roger O. Walther, 80, Chairman Emeritus Founding Chairman and member of Director’s Loan Committee, Mr. Walther is Chairman of Tusker Corporation, a real estate management fi rm, Director of The Charles Schwab Corporation and a Chancellor’s Associate and member of the Audit Committee of the UCSF Foundation. B.S., 1958, United States Coast Guard Academy; M.B.A., 1961, Wharton School, University of Pennsylvania. 76. 77. Locations Northern California San Francisco 101 Pine Street (at Front Street) San Francisco, California 94111 (415) 392-1400; (800) 392-1400 One Embarcadero Center Street Level (at Front Street) San Francisco, California 94111 (415) 398-8880 44 Montgomery Street (at Sutter Street) San Francisco, California 94104 (415) 392-3888 1088 Stockton Street (at Jackson Street) San Francisco, California 94108 (415) 834-0888 2001 Van Ness Avenue (at Jackson Street) San Francisco, California 94109 (415) 447-0888 The Presidio of San Francisco 210 Lincoln Boulevard (next to Post Offi ce) San Francisco, California 94129 (415) 561-2988 Moving mid 2016 to 558 Presidio Boulevard (at Letterman Drive) San Francisco, California 94129 3533 California Street (in Laurel Village) San Francisco, California 94118 (415) 831-6688 6001 Geary Boulevard (at 24th Avenue) San Francisco, California 94121 (415) 751-3888 653 Irving Street (at 8th Avenue) San Francisco, California 94122 (415) 564-8881 1809 Irving Street (at 19th Avenue) San Francisco, California 94122 (415) 664-0888 279 West Portal Avenue (at 14th Avenue) San Francisco, California 94127 (415) 504-8799 Market Square 1355 Market Street, Suite 140 (at 9th Street) San Francisco, California 94103 (415) 487-0888 1215 El Camino Real (at Oak Grove Avenue) Menlo Park, California 94025 (650) 470-8888; (888) 907-6888 1400 Civic Drive (at North Broadway) Walnut Creek, California 94596 (925) 256-6857 2550 Sand Hill Road, Suite 100 (at Monte Rosa Drive) Menlo Park, California 94025 (650) 233-8880 680 Hartz Avenue (at Railroad Avenue) Danville, California 94526 (925) 820-1777 2275 El Camino Real (at Cambridge Avenue) Palo Alto, California 94306 (650) 329-8883; (866) 818-8883 3130 Crow Canyon Place (at Crow Canyon Road) San Ramon, California 94583 (925) 866-1414 400 South San Antonio Road (at Lyell Street) Los Altos, California 94022 (650) 559-8810; (877) 838-8989 249 Main Street (at Old Bernal Avenue) Pleasanton, California 94566 (925) 846-8811 405 Howard Street (at Fremont Street) San Francisco, California 94105 (Projected opening Spring 2016) 201 West El Camino Real (at South Frances Street) Sunnyvale, California 94087 (408) 733-8881 One Front Street (at Market Street) San Francisco, California 94111 (Projected opening Fall 2016) 10297 South De Anza Boulevard (at Rodrigues Avenue) Cupertino, California 95014 (408) 973-8881 San Francisco Peninsula 139 South El Camino Real (at Murchison Drive) Millbrae, California 94030 (650) 692-6880 1155 California Drive (at Broadway) Burlingame, California 94010 (650) 579-2888 1625 The Alameda (at Villa Avenue) San Jose, California 95126 (408) 999-0242 275 Los Gatos Saratoga Road (at Massol Avenue) Los Gatos, California 95030 (408) 395-2235 San Francisco East Bay 1111 South El Camino Real (at 12th Avenue) San Mateo, California 94402 (650) 571-8388; (888) 571-8388 2110 Mountain Boulevard (at Merced Avenue in Montclair) Oakland, California 94611 (510) 530-8881 776 El Camino Real (at Broadway) Redwood City, California 94063 (650) 216-8883 224 Brookwood Road (at Camino Pablo) Orinda, California 94563 (925) 254-8993 211 South J Street (at 2nd Street) Livermore, California 94550 (925) 373-3811 Marin County 1218 Strawberry Village (at Redwood Highway Frontage Road) Mill Valley, California 94941 (415) 389-0880 1099 Fourth Street (at A Street) San Rafael, California 94901 (415) 485-3888; (800) 700-0388 Napa County 1753 Trancas Street (at Old California Way) Napa, California 94558 (707) 254-8600 999 Adams Street, Suite 401 (at Library Lane) St. Helena, California 94574 (707) 968-0988 Sonoma County Palm Desert Oregon Connecticut 640 Third Street (at D Street) Santa Rosa, California 95404 (707) 544-8881; (888) 492-0888 73-010 El Paseo (at Highway 74) Palm Desert, California 92260 (760) 776-8882 Southern California Los Angeles 1888 Century Park East (north of Olympic in Century City) Los Angeles, California 90067 (310) 712-1888; (877) 743-7777 9593 Wilshire Boulevard (at Dayton Way) Beverly Hills, California 90212 (310) 288-0777; (800) 311-0777 11770 San Vicente Boulevard (at Gorham Ave. in Brentwood) Los Angeles, California 90049 (310) 820-1820 431 Wilshire Boulevard (at 5th Street) Santa Monica, California 90401 (310) 393-8889 12070 Ventura Boulevard (at Laurel Canyon Boulevard) Studio City, California 91604 (818) 752-4777 888 South Figueroa Street (at West 9th Street) Los Angeles, California 90017 (213) 239-8883 Santa Barbara Newport Beach 3991 MacArthur Boulevard (at Bowsprit Drive) Newport Beach, California 92660 (949) 756-8828; (888) 339-3088 2800 East Coast Highway (at Goldenrod Avenue) Corona del Mar, California 92625 (949) 721-0988; (888) 694-8337 San Diego County 1280 4th Avenue (at A Street) San Diego, California 92101 (619) 238-9088 8347 La Mesa Boulevard (at 3rd Street) La Mesa, California 91942 (619) 462-6700 1200 Prospect Street (at Ivanhoe Avenue) La Jolla, California 92037 (858) 454-8883; (888) 648-8878 1110 Camino Del Mar (north of 11th Street) Del Mar, California 92014 (858) 755-5600; (800) 221-9333 116 East Grand Avenue (at North Broadway) Escondido, California 92025 (760) 740-7000 1200 State Street (at E Anapamu Street) Santa Barbara, California 93101 (805) 560-6883 12626 High Bluff Drive, Suite 400 (at Del Mar Heights Road) San Diego, California 92130 (858) 259-2795 947 SW Broadway (at SW Salmon Street) Portland, Oregon 97205 (503) 525-8800 New York Rockefeller Center 1230 Avenue of the Americas (at 48th Street) New York, New York 10020 (212) 459-9000; (877) 486-6700 Time Warner Center 10 Columbus Circle (at West 59th Street) New York, New York 10019 (212) 331-0088; (866) 309-8080 2160 Broadway (at 76th Street) New York, New York 10024 (212) 580-8588 148 East 79th Street (at Lexington Avenue) New York, New York 10075 (212) 288-6888 575 Madison Avenue (at 56th Street) New York, New York 10022 (212) 371-8088 93 Mason Street (at Lewis Street) Greenwich, Connecticut 06830 (203) 422-0818; (866) 810-8918 Massachusetts 160 Federal Street (at High Street) Boston, Massachusetts 02110 (617) 330-1288; (866) 810-8919 One Post Offi ce Square (at Milk Street) Boston, Massachusetts 02109 (617) 423-2888 772 Boylston Street (at Mandarin Oriental Hotel) Boston, Massachusetts 02199 (617) 859-8888 284 Washington Street (at Eaton Court) Wellesley, Massachusetts 02481 (781) 239-9881 New Hampshire Lending Offi ce 130 Main Street, Suite 206A Salem, New Hampshire 03079 (603) 893-8875; (866) 780-8808 320 Park Avenue (at 51st Street) New York, New York 10022 (212) 486-8882 Florida 443 Park Avenue South (at East 30th Street) New York, New York 10016 (212) 532-8882 442 6th Avenue (at 10th Street) New York, New York 10011 (212) 253-8888 241 Royal Palm Way (west of South County Road) Palm Beach, Florida 33480 (561) 835-8829 78. 79. Private Wealth Management Northern California 111 Pine Street (at Front Street) San Francisco, California 94111 (415) 288-1400; (800) 257-4414 2500 Sand Hill Road, Suite 200 (at Monte Rosa Drive) Menlo Park, California 94025 (650) 433-5508 3000 Sand Hill Road, Suite 2-160 Menlo Park, California 94025 (650) 352-9300 2275 El Camino Real (at Cambridge Avenue) Palo Alto, California 94306 (650) 329-8883; (866) 818-8883 Southern California 1888 Century Park East (north of Olympic in Century City) Los Angeles, California 90067 (310) 712-1888; (877) 743-7777 1200 State Street (at E Anapamu Street) Santa Barbara, California 93101 (800) 677-0953 3991 MacArthur Boulevard Suite 300 (at Bowsprit Drive) Newport Beach, California 92660 (949) 756-8828; (888) 339-3088 12626 High Bluff Drive, Suite 400 (at Del Mar Heights Road) San Diego, California 92130 (858) 259-2795 Oregon 947 SW Broadway (at SW Salmon Street) Portland, Oregon 97205 (503) 525-8800; (888) 848-3680 Washington 900 Washington Street Suite 8001 Vancouver, Washington 98660 (360) 695-6047 New York Rockefeller Center 1230 Avenue of the Americas (at 48th Street) New York, New York 10020 (212) 759-7755; (800) 775-0604 1001 Franklin Avenue, Suite 210 (at 10th Street) Garden City, New York 11530 (516) 873-7888 Massachusetts 160 Federal Street (at High Street) Boston, Massachusetts 02110 (617) 330-1288; (866) 810-8919 284 Washington Street (at Eaton Court) Wellesley, Massachusetts 02481 (781) 239-9881 Delaware 1201 North Market Street 10th Floor (at West 12th Street) Wilmington, Delaware 19801 (302) 888-2988 Florida 241 Royal Palm Way (west of South County Road) Palm Beach, Florida 33480 (561) 835-8829 Hawaii 745 Fort Street Mall, Suite 1202 Honolulu, Hawaii 96813 (808) 524-4477; (866) 524-4477 First Republic Private Wealth Management includes First Republic Trust Company; First Republic Trust Company of Delaware LLC; First Republic Investment Management, Inc., an SEC Registered Investment Advisor; and First Republic Securities Company, LLC, Member FINRA/SIPC. 80. Celebrating 30 Years Read about First Republic’s heritage in The Power of a Client-Focused Heritage and Culture. The First Republic Bank heritage story is available through the App Store for iPhone® and iPad®. Heritage Story Corporate Information stock trading Listed on the New York Stock Exchange: Common Stock Symbol – FRC Preferred Stock Series A-G Symbols: FRCPrA, FRCPrB, FRCPrC, FRCPrD, FRCPrE, FRCPrF, FRCPrG transfer agent Common and Preferred Stock – Computershare Shareowner Services, LLC external counsel Sullivan & Cromwell LLP Arnold & Porter LLP auditors KPMG LLP Text pages printed on Utopia One X Silk. It is an FSC® certified paper manufactured with renewable energy and includes 20% post-consumer recovered fiber. 100% of the electricity used to manufacture it is matched with renewable energy credits (RECS) from Green-e® certified energy sources—primarily wind. Design: Howry Design Associates / San Francisco Principal Photography: Jamey Stillings Helgi and Marlene Tomasson: Erik Tomasson Urban Solutions: Bryon Malik Project Directors: Seta Hanoian and Paula Lucas © 2016 First Republic Bank. All rights reserved. 111 Pine Street San Francisco, CA 94111 (415) 392-1400 (800) 392-1400 www.fi rstrepublic.com www.facebook.com/fi rstrepublicbank www.twitter.com/fi rstrepublic

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