Vernon Hill ousted as Republic Bank chairman after key board ally dies

A boardroom coup following the death of a key ally of Republic First Bancorp Inc.’s divided board of directors has forced veteran Moorestown banker Vernon Hill out of his post as chairman of the board of directors. administration of the Philadelphia corporation, which operates Republic Bank and its 33 branches in New Jersey, Pennsylvania and New York.

Hill was replaced by Harry Madonna, returning to a role he held before he and Hill became adversaries in a struggle for control. Madonna said in a statement Friday that it looks forward to “working with the board and our employees” to “create value for our constituents.”

But the combative Hill remains Chief Executive of the Republic, with allies considering a legal counteroffensive. Hill also retains a seat on the board. Hill said Saturday he would have no immediate comment.

READ MORE: Republic Bank board splits into opposing camps loyal to Vernon Hill or George Norcross

Hill’s removal from the top board position by members who support dissident investors was made possible by the death on Tuesday of a Hill supporter Theodore J. Flocco, retired accountant, who lived in Mount Laurel.

In a statement to bank workers on Thursday, Hill praised Flocco as “loyal” and a supporter of Hill’s efforts to grow the bank in metro Philadelphia and New York.

Flocco and Hill were part of a four-member Republic board faction that had locked horns with Hill’s critics and prevented movements against him and his policies.

The dissenters — who got a one-vote majority with Flocco’s passing — are Andrew B. Cohen, a longtime investment manager for Wall Street billionaire and New York Mets owner Steven A. Cohen. ; attorney Lisa Jacobs, a partner at Stradley Ronon Stevens & Young in Philadelphia; Madonna; and Harvey Wildstein, who runs LifeLine Funding LLC.

READ MORE: Philly Bank Deal: Norcross Group Proposes to Acquire Majority Control of Hill’s Republic

They side with longtime South Jersey insurance broker, hospital superintendent and Democratic party king George Norcross.

The group did not wait for Flocco’s funeral mass, scheduled for Wednesday at St. Joan of Arc Catholic Church in Marlton, to exploit his death by using their newfound majority to call for a board vote that they expected to see lose.

Norcross supports the efforts of activist investors seeking to oust Hill in favor of their own candidates in the bank’s 2022 board elections, which have yet to be scheduled. Hill’s remaining allies include accountant Barry Spevak and Brian Tierney, founder of Brian Communications, whose clients include First Republic. (Norcross and Tierney were each executives of investor groups that previously owned The Inquirer.)

Norcross allies include former TD Bank executive Gregory Barca – the two heads of an investor group that bought shares in Republic – as well as Driver Management Co., a hedge fund that has compiled a list of insurgent candidates to replace Hill and his board allies.

These dissidents blame Hill for driving down Republic’s profits. They say Hill has spent too much money building new bank branches at a time when more Americans are banking online and most banks are closing, not adding, branches. They also accused the Hill administration of delaying financial reporting and favoring businesses controlled by family and friends for banking contracts. They say the bank needs to cut costs so there is more money for shareholders.

READ MORE: Philly Bank Deal: Norcross Group Proposes to Acquire Majority Control of Hill’s Republic

Hill defended his strategies as proven ways to create value over time, as well as commit to increasing technology spending. But criticism of Republic has grown as the shares have fallen in value, relative to other banks, in recent years. The action revived over the winter when the Norcross and Driver factions joined forces and publicly called on other shareholders to support them, but fell again when the bank delayed financial reports and board elections, and during the general stock market retreat when the Federal Reserve raised interest rates.

Hill had previously resigned from top positions at two banks he founded.

In 2007, board fights led him to leave the former Commerce Bancorp, which was based in Marlton and was more than 10 times larger than Republic, with branches from Connecticut to the Washington, D.C. area. . When Hill left, Norcross stayed with the bank and helped arrange its sale to TD Bank.

In 2019 he left Metro Bank (UK), founded with the backing of transatlantic property investors and with the promise of shaking up UK retail banking culture, after it was found the company had downplayed mistakenly its probable losses due to bad debts.

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