April 26 (Reuters) - U.S. regulators have seized

Republic First Bancorp ( FRBK ) and agreed to sell it to Fulton

Bank, underscoring the challenges facing regional banks a year

after the collapse of three peers.

Philadelphia-based Republic First, which had abandoned

funding talks with a group of investors, was seized by the

Pennsylvania Department of Banking and Securities.

The Federal Deposit Insurance Corp (FDIC), appointed as a

receiver, said on Friday Fulton Bank, a unit of Fulton Financial

Corp ( FULT ), will assume substantially all deposits and

purchase all the assets of Republic Bank, which is the operating

name for Republic First, to "protect depositors".

Republic Bank had about $6 billion in total assets and $4

billion in total deposits, as of Jan. 31, 2024. The FDIC

estimated the cost of the failure to its fund will be $667

million.

Apart from deposits, Republic also had borrowings and other

liabilities of approximately $1.3 billion, Fulton said in a

statement.

Fulton said the deal almost doubles its presence in the

Philadelphia market with combined company deposits of

approximately $8.6 billion.

"With this transaction, we are excited to double our

presence across the region," said Fulton Chairman and

CEO Curt Myers in a statement.

Republic Bank's 32 branches in New Jersey, Pennsylvania and

New York will reopen as branches of Fulton Bank on Saturday or

on Monday during business hours.

The decision marks the latest U.S. regional bank failure

following the unexpected collapses of three lenders - Silicon

Valley and Signature in March 2023 and First Republic in May.

Republic Bank had struck a deal with an investor group that

included veteran businessman George Norcross and high-profile

attorney Philip Norcross late last year, but the effort was

terminated in February.

After that deal collapsed, the FDIC resumed efforts to seize

and sell the bank, according to the Wall Street Journal, which

first reported the news.

Republic Bank cut jobs and exited its mortgage origination

business in early 2023 as it reeled under pressure from higher

costs and inability to improve profitability

The bank's stock price has tumbled from just over $2 at the

start of the year to about 1 cent on Friday, leaving it with a

market capitalization below $2 million.

Its shares were delisted from the Nasdaq in August and now

trade over the counter.

Piper Sandler & Co and BofA Securities acted as financial

advisers to Fulton, while Sullivan & Cromwell LLP acted as legal

adviser.

(Reporting by Manas Mishra, Pritam Biswas and Nathan Gomes in

Bengaluru; Additional reporting by Saeed Azhar in New York;

Editing by Shilpi Majumdar, Sriraj Kalluvila and Muralikumar

Anantharaman)