REPUBLIC BANKING CORP OF FLORIDA
DEF 14A, 1998-04-24
STATE COMMERCIAL BANKS
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                            SCHEDULE 14A INFORMATION

                    Proxy Statement Pursuant to Section 14(a)
                     of the Securities Exchange Act of 1934


Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]

Check the appropriate box:
[ ]      Preliminary Proxy Statement
[ ]      Confidential, for Use of the Commission Only
         (as permitted by Rule 14a-6(e)(2)
[X]      Definitive Proxy Statement
[ ]      Definitive Additional Materials
[ ]      Soliciting Materials Pursuant to /section/240.14a11(c) or
         /section/240.14a-12

                     Republic Banking Corporation of Florida
                (Name of Registrant as Specified in Its Charter)


     (Name of Person(s) Filing Proxy Statement if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):
[X]      No fee required.
[ ]      Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
         0-11.

         1) Title of each class of securities to which transaction applies:

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         2) Aggregate Number of securities to which transaction applies:

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         3)       Per  unit  price  or other  underlying  value  of  transaction
                  computed  pursuant  to  Exchange  Act Rule 0-11 (Set forth the
                  amount on which the filing fee is calculated  and state how it
                  was determined):

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         4) Proposed maximum aggregate value of transaction:

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         5) Total fee paid:

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[ ]      Fee paid previously with preliminary materials.
[ ]      Check box if any part of fee is offset as provided  by  Exchange  Act
         Rule  0-11(a)(2)  and identify the filing for which the  offsetting fee
         was paid  previously.  Identify  the  previous  filing by  registration
         number, or Form or Schedule and the date of its filing.

         1) Amount Previously Paid:

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         2) Form, Schedule or Registration Statement No.:

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         4) Date Filed:

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<PAGE>


                    REPUBLIC BANKING CORPORATION OF FLORIDA
                         2800 PONCE DE LEON BOULEVARD
                          CORAL GABLES, FLORIDA 33134


                               ----------------
                    NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
                          TO BE HELD ON MAY 20, 1998
                               ----------------

To the Shareholders of Republic Banking Corporation of Florida:


     The Annual Meeting of Shareholders (the "Annual Meeting") of Republic
Banking Corporation of Florida (the "Corporation") will be held at 2800 Ponce
de Leon Boulevard, Coral Gables, Florida 33134, on Wednesday, May 20, 1998, at
10:30 a.m., Eastern time, for the purpose of considering and acting on the
following matters:


         1.       A proposal to elect the three nominees named in the attached
                  proxy statement to serve as Class I directors of the
                  Corporation with terms expiring at the 2001 Annual Meeting of
                  Shareholders or until their successors are duly elected and
                  qualified;


         2.       A proposal to approve the 1998 Stock Option Plan, as set forth
                  in Appendix A hereto;


         3.       A proposal to ratify the appointment of Price Waterhouse LLP,
                  independent public accountants, as auditors of the Corporation
                  for 1998; and


         4.       Such other business as may properly come before the Annual
                  Meeting or any adjournments thereof.


     Only holders of record of the Corporation's Common Stock on the books of
the Corporation at the close of business on April 14, 1998, which has been
fixed as the Record Date by the Board of Directors, are entitled to notice of
and to vote at the Annual Meeting.


                                        By Order of the Board of Directors



                                        Lydia A. Fernandez, Secretary


Coral Gables, Florida
April 27, 1998


     WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE COMPLETE,
DATE AND SIGN THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE TO ENSURE THAT YOUR SHARES ARE VOTED AT THE ANNUAL
MEETING. SHAREHOLDERS WHO EXECUTE A PROXY CARD MAY, NEVERTHELESS, ATTEND THE
ANNUAL MEETING, REVOKE THEIR PROXY AND VOTE THEIR SHARES IN PERSON.
<PAGE>

                    REPUBLIC BANKING CORPORATION OF FLORIDA
                         2800 PONCE DE LEON BOULEVARD
                          CORAL GABLES, FLORIDA 33134


                               ----------------
                        ANNUAL MEETING OF SHAREHOLDERS
                                 MAY 20, 1998
                                PROXY STATEMENT
                               ----------------

     The enclosed proxy is solicited on behalf of the Board of Directors of
Republic Banking Corporation of Florida (the "Corporation") in connection with
the Annual Meeting of Shareholders of the Corporation (the "Annual Meeting") to
be held at 2800 Ponce de Leon Boulevard, Coral Gables, Florida 33134, on
Wednesday, May 20, 1998, at 10:30 a.m., Eastern time, and any adjournments or
postponements thereof. The complete mailing address of the principal executive
offices of the Corporation, including zip code, is 2800 Ponce de Leon
Boulevard, Coral Gables, Florida 33134. The Corporation's telephone number is
(305) 774-5197.


     The accompanying form of proxy is for use at the Annual Meeting if a
shareholder does not attend the Annual Meeting in person or wishes to have his
or her shares voted by proxy even if the shareholder attends the Annual
Meeting. The proxy may be revoked by the person giving it, at any time before
it is exercised, by such person (i) giving written notice of such revocation to
the Secretary of the Corporation, (ii) submitting a proxy having a later date,
or (iii) appearing at the Annual Meeting and electing to vote in person. All
shares represented by valid proxies received pursuant to this solicitation and
not revoked before they are exercised will be voted in the manner specified
thereon. If no specification is made, proxies will be voted in favor of
approval of Proposals 1, 2 and 3 described below and in the discretion of the
persons named as proxies with respect to any other matter that may come before
the meeting or any adjournment or postponement thereof.


     This proxy statement and the enclosed form of proxy and Annual Report are
being first mailed to the Corporation's shareholders entitled to notice of and
to vote at the Annual Meeting on or about April 27, 1998. The Annual Report
does not constitute "soliciting material" and is not to be deemed "filed" with
the Securities and Exchange Commission (the "Commission").


     The Corporation will bear the cost of preparing this proxy statement and
of soliciting proxies in the enclosed form. Proxies may be solicited by
employees of the Corporation and its subsidiaries, either personally, by letter
or by telephone. Such employees will not be specifically compensated for
soliciting such proxies. The Corporation will reimburse banks, custodians,
brokerage houses, nominees and other fiduciaries for their reasonable expenses
in sending the proxy material to their principals.


     Holders of the Corporation's Common Stock of record on the books of the
Corporation as of the close of business on April 14, 1998 (the "Record Date")
will be entitled to notice of and to vote at the Annual Meeting and any
adjournments thereof. As of April 14, 1998, the Corporation had outstanding
21,326,399 shares of common stock, par value $0.01 per share ("Common Stock").
Each holder of Common Stock will have the right to one vote for each share of
such stock standing in such holder's name on the books of the Corporation as of
the close of business on the Record Date, with respect to each matter voted on
at the Annual Meeting.


     The presence in person or by proxy of a majority of the shares of Common
Stock outstanding on the Record Date will constitute a quorum for purposes of
conducting business at the Annual Meeting. If less than a majority of the
outstanding shares of Common Stock are represented at the Annual Meeting, the
majority of the shares so represented may adjourn the meeting from time to time
without
<PAGE>

further notice until a quorum is obtained. For purposes of determining the
votes cast with respect to any matter presented for consideration at the Annual
Meeting, only those votes cast "FOR" or "AGAINST" will be included. Abstentions
and broker non-votes (i.e., shares held by brokers on behalf of their
customers, which may not be voted on certain matters because the brokers have
not received specific voting instructions from their customers with respect to
such matters and do not have discretionary power) will be counted solely for
the purpose of determining whether a quorum is present and will not have the
effect as a vote against the election of any director or any other matter.


     In order to be elected, nominees for director must receive a plurality of
the votes cast by the holders of shares of Common Stock voting in person or by
proxy at the Annual Meeting. In order to approve the 1998 Stock Option Plan and
to ratify the appointment of Price Waterhouse LLP as auditors of the
Corporation for the year 1998, the votes cast in person or by proxy for each of
such proposals must exceed the votes cast against it. Rebank Netherlands
Antilles N.V. ("Rebank"), which owns 56.9% of all of the issued and outstanding
shares of Common Stock of the Corporation, and Roberto Isaias, Estefano and
Mariela Isaias, husband and wife, and William Isaias, who own Rebank and who,
directly or indirectly, own in the aggregate 59.6% of all of the issued and
outstanding shares of Common Stock of the Corporation, inclusive of the shares
owned by Rebank, have advised the Corporation that they intend to vote their
shares in favor of all nominees for director and all of the foregoing
proposals. Accordingly, all nominees for director will be elected and all such
proposals will be approved, notwithstanding the vote of any other shareholder.



                             ELECTION OF DIRECTORS

                (PROPOSAL NUMBER 1 ON THE ENCLOSED PROXY CARD)


     The Corporation's Articles of Incorporation (as amended, the "Articles")
provide that the Board of Directors shall be divided into three classes, each
as nearly equal in number to the other as possible, and that, at each annual
meeting of shareholders, the shareholders shall elect the members of one of the
three classes to three-year terms of office. For purposes of the election of
directors at the Annual Meeting, the number of directors has been fixed at 9,
three directors in Class I, three directors in Class II and three directors in
Class III.


     The terms of office of the current directors serving in Class I will
expire at the Annual Meeting and the terms of office of the current directors
serving in Classes II and III will expire at the 1999 and 2000 Annual Meetings
of Shareholders, respectively, and in each case until their successors are duly
elected and qualified.


     The Board of Directors has nominated the following individuals for
election as Class I Directors to serve until the 2001 Annual Meeting of
Shareholders or until their successors are duly elected and have qualified:


                                 John H. Blake
                                William Isaias
                                Fernando Tamayo


     All of the nominees are directors of the Corporation and have consented to
being named as nominees herein and to serve if elected. John H. Blake and
Fernando Tamayo are also directors of the Corporation's 99.1%-owned subsidiary,
Republic National Bank of Miami (the "Bank"). Directors of the Corporation will
be elected by a plurality of the votes cast. Shares cannot be voted for a
greater number of persons than the number of nominees named herein. Should any
nominee be unavailable for election by reason of death or other unexpected
occurrence, the enclosed proxy, to the extent permitted by applicable law, may
be voted, at the discretion of the proxies, in favor of such substitute nominee
or nominees as may be selected by the Board of Directors of the Corporation or
the Board may reduce the


                                       2
<PAGE>

number of directors to be elected at the Annual Meeting. For biographical
information on the nominees, see "Board of Directors--Class I Nominees for
Election to Terms Expiring in 2001".


     THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE ELECTION
OF ALL NOMINEES AS DIRECTORS. PROXIES, UNLESS INDICATED TO THE CONTRARY, WILL
BE VOTED "FOR" THE ELECTION OF THE THREE NOMINEES NAMED ABOVE AS CLASS I
DIRECTORS TO SERVE FOR TERMS EXPIRING AT THE 2001 ANNUAL MEETING OF
STOCKHOLDERS OR UNTIL THEIR SUCCESSORS ARE DULY ELECTED AND QUALIFIED.



                    APPROVAL OF THE 1998 STOCK OPTION PLAN

                (PROPOSAL NUMBER 2 ON THE ENCLOSED PROXY CARD)


     In November 1997 and January 1998, respectively, the Corporation's Board
of Directors and the holders of a majority of the Corporation's shares, acting
by written consent in lieu of a meeting, adopted and approved the Corporation's
1998 Stock Option Plan (the "Plan"). The material features of the Plan are
discussed below, but the description is subject to, and is quantified in its
entirety by, the full text of the Plan which is attached hereto as Appendix  A.
 


     Section 162(m) of the Internal Revenue Code of 1986, as amended (the
"Code"), generally prohibits a public company from deducting compensation paid
to the chief executive officer and the four other highest paid executive
officers in excess of $1,000,000.00 per year. Qualified performance- based
compensation, as such term is defined under Section 162(m) of the Code, is not
subject to this limit. Under a special transition rule, compensation resulting
from the exercise of stock options granted under the Plan will not be subject
to the Section 162(m) limitations until the earlier of (i) the date on which
the Plan is materially modified or (ii) the annual meeting of shareholders of
the Corporation for the year 2002. In order for compensation resulting from the
exercise of options granted under the Plan after the end of this transition
period to qualify as performance-based compensation, the Plan must be approved
by the Corporation's shareholders after the Corporation becomes a publicly held
corporation. The Plan is being presented to the shareholders in order to comply
with the requirements of Section 162(m) of the Code with respect to awards
granted under the Plan after the transition period.


GENERAL


     Effective on January 1, 1998, 1,000,000 shares of the Corporation's Common
Stock were reserved for issuance upon exercise of stock options granted under
the Plan. Options under the Plan may be granted to regular employees of, or
persons who provide consulting or other services as independent contractors to,
the Corporation or its subsidiaries, including directors and officers who are
regular employees, and to directors who are not employees of the Company or of
any of its subsidiaries. To date options for 500,000 shares have been issued
under the Plan, all of which remain unexercised. Grants of option under the
Plan may be made from time to time and it is not possible to indicate the
precise number, names or positions of the persons who will receive options.
Currently, the only subsidiary of the Corporation is the Bank. On March 31,
1998, the number of employees and directors of the Corporation and the Bank was
approximately 745.


     The Plan is designed as a means to retain and motivate qualified and
competent persons who provide services to the Corporation and its subsidiaries
and upon whose efforts and judgment the success of the Corporation and its
subsidiaries is largely dependent through the encouragement of stock ownership
in the Corporation by such persons. The Compensation Committee of the Board of
Directors will administer and interpret the Plan, subject to approval by the
Board of Directors. The Compensation Committee is to be comprised of two or
more directors each of whom qualifies as an "outside director" under Section
162(m) of the Code and the regulations thereunder and as a "Non-Employee
Director" under Rule 16(b)-3 promulgated under the Securities Exchange Act of
1934, as

                                       3
<PAGE>

amended from time to time (the "Exchange Act"). The Compensation Committee is
currently comprised of Messrs. Jose P. Bared and Fernando Tamayo. The
Compensation Committee, subject to final approval of the Board of Directors, is
authorized to grant options under the Plan to all eligible persons. The
Compensation Committee, with the Board's approval, from time to time may adopt
rules and regulations for carrying out the purposes of the Plan. The
determinations by the Committee and the Board of Directors, and the
interpretations and construction of any provision of the Plan or any option by
the Committee and Board, shall be final and conclusive. The Compensation
Committee serves at the pleasure of the Board and has the powers designated in
the Plan and such other powers as the Board of Directors may from time to time
confer upon it.


     In the event of a change in the Common Stock due to a stock dividend or
recapitalization, the Plan provides for appropriate adjustment in the number of
shares available for grant under the Plan and the number of shares and the
exercise price per share under any option then outstanding under the Plan.
Unless otherwise provided in any option, the Compensation Committee, with the
Board of Directors' approval, may change the option price and/or number of
shares under any outstanding option when, in their discretion, such adjustment
becomes appropriate so as to preserve but not increase benefits under the Plan.
The aggregate number of shares subject to options granted to any one optionee
under the Plan may not exceed 400,000, subject to adjustment as described
above.


     The Plan provides for the granting of both incentive stock options (as
defined in Section 422 of the Code) and nonqualified stock options. No
incentive stock options may be granted to a person who is not also an employee
of the Corporation or a subsidiary. Options may generally be granted under the
Plan on such terms and at such prices as determined by the Compensation
Committee, subject to the approval of the Board of Directors, except that the
per share exercise price of any options cannot be less than the fair market
value of a share of the Common Stock on the date of grant. As long as the
Common Stock is quoted on the NASDAQ National Market ("NASDAQ"), then, for
purposes of the Plan, the term "fair market value" is defined as the last
reported sales price for the Common Stock quoted on the NASDAQ. On April 14,
1998, the last reported sales price per share of Common Stock on the NASDAQ was
$18.75. Incentive stock options granted to an individual who owns (or is deemed
to own) at least 10% of the total combined voting power of all classes of stock
of the Corporation or its subsidiary must have an exercise price of at least
110% of the fair market value of the Common Stock subject to such option on the
date of grant and a term of no more than five years.


     Each Option is to be evidenced by an option agreement that may contain any
term deemed necessary or desirable by the Compensation Committee and the Board,
provided such terms are not inconsistent with the Plan or any applicable law.
Each option is exercisable after the period or periods specified in the option
agreement, but no option may become exercisable after the expiration of ten
years from the date of grant and no option granted to an employee of the
Corporation or any subsidiary may vest over a period of less than three years
in equal annual increments; however, the Compensation Committee, with the Board
of Directors' approval, may accelerate the exercisability or vesting of any
option or shares previously acquired by the exercise of any options, and, in
the event of a Change in Control (as defined in the Plan), each outstanding
option will become immediately fully exercisable. Under the Plan, a Change in
Control occurs (i) upon the approval by the shareholders of the Corporation of
any transaction resulting in the shareholders of the Corporation immediately
before such transaction not owning more than 50% of the voting stock of the
Corporation or of any entity that results from the participation of the
Corporation in a reorganization, consolidation, merger or other transaction;
(ii) when the shareholders of the Corporation approve the liquidation or
dissolution of the Corporation or the sale of all or substantially all of the
assets of the Corporation; or (iii) upon the acquisition by any person, entity
or group (excluding, the Corporation or its subsidiaries, or any employee
benefit plan of the Corporation or its subsidiaries, and excluding Rebank) of
51% or more of the voting stock of the Corporation. Incentive stock options
granted under the Plan are not transferable other than by will or by the laws
of descent and distribution. Nonqualified stock options are also not
transferable unless the consent of the Compensation Committee is obtained and
such transfer does not violate Rule 16b-3 under the Exchange Act.


                                       4
<PAGE>

     Unless otherwise provided in any option, the option price may be paid by
cash, certified or official bank check, personal check if accepted by the
Compensation Committee or the Board of Directors, money order, shares of Common
Stock, withholding of shares of Common Stock, any cashless exercise procedure
approved by the Compensation Committee or the Board of Directors, other
consideration deemed appropriate by the Compensation Committee or the Board of
Directors or a combination of the above. The Plan also authorizes the
Corporation to make or guarantee loans to optionees to enable them to exercise
their options. Such loans must (i) provide for recourse to the optionee, (ii)
bear interest at no less than the prime rate of the Bank, (iii) be secured by
the shares of Common Stock purchased and (iv)  comply with all applicable laws
and regulations.


     As of the Record Date, the Compensation Committee, with the approval of
the Board of Directors, had granted options pursuant to the Plan for an
aggregate of 500,000 shares of Common Stock, of which options for 380,000
shares were granted to employees of the Corporation and the Bank (including the
Named Officers as defined below) and options for 10,000 shares of Common Stock
were granted to each of twelve non-employee directors of the Corporation and
the Bank. All options were granted at an exercise price of $15.00 per share,
the public offering price of the Common Stock for the initial public offering
of the Corporation's Common Stock which was completed in February 1998. All
options were granted effective February 11, 1998 (the date of the initial
public offering of the Corporation's Common Stock), are currently outstanding
(including options for 5,000 shares granted to an employee who has left the
employ of the Bank and whose options, therefore, will terminate prior to
vesting), and have a term of ten (10) years. Options to employees, including
the Named Officers, are exercisable in 20% increments over a five year period
beginning on the second anniversary of the date of grant. All options granted
to non-employee directors who have served on the Board of Directors of the
Corporation or the Bank for at least ten years, which includes all directors
other than Ms. Anne Betancourt and Mr. Fernando Tamayo, will be exercisable
beginning six months after the date of grant. The options granted to Ms.
Betancourt and Mr. Tamayo are exercisable on the same schedule as the options
granted to employees. All options granted to employees are incentive stock
options to the extent allowed by law. All options granted to directors are
non-qualified options (see discussion below on Incentive Stock Options and
Non-Qualified Options).


     The Board of Directors or the Compensation Committee with the approval of
the Board has the authority to amend or terminate the Plan or any options,
provided that no such action may substantially impair the rights or benefits of
the holder of any outstanding option without the consent of such holder, and
provided further that certain amendments to the Plan are subject to shareholder
approval. Unless terminated sooner, the Plan will continue in effect until all
options granted thereunder have expired or been exercised, provided that no
options may be granted after December 31, 2007.


                                       5
<PAGE>

     The following table sets forth certain information with respect to options
granted under the Plan to i) the Chief Executive Officer of the Corporation
(the "CEO") and each of the four most highly paid executive officers of the
Corporation or of the Bank (the "CEO" and such Executive Officers, the "Named
Officers"), ii) all executive officers of the Corporation or of the Bank as a
group, including the Named Officers, iii) the three nominees for director, iv)
all current directors of the Corporation who are not executive officers as a
group and v) all employees of the Corporation or of the Bank as a group, other
than executive officers.

<TABLE>
<CAPTION>
                                                                      NUMBER OF SHARES         VALUE OF OPTIONS
NAME AND POSITION                                                    SUBJECT TO OPTIONS     AT APRIL 14, 1998(1)(2)
- -----------------------------------------------------------------   --------------------   ------------------------
<S>                                                                 <C>                    <C>
OSCAR BUSTILLO, JR.,                                                       100,000              $  375,000.00
 President, Chief Executive Officer and Director of the
 Corporation and Chairman of the Board, Chief Executive
 Officer and President of the Bank

FELIX M. GARCIA,                                                            50,000                 187,500.00
 Executive Vice President, Chief Credit Officer and Director
 of the Bank

BERNARDO M. ARGUDIN,                                                        50,000                 187,500.00
 Vice President, Chief Financial Officer and Director of the
 Corporation and Executive Vice President, Chief Financial
 Officer and Director of the Bank

FERNANDO J. MARTINEZ,                                                       30,000                 112,500.00
 Executive Vice President of Real Estate Lending of the Bank

RAFAEL QUINTANA,                                                            30,000                 112,500.00
 Executive Vice President of Retail Banking of the Bank

ALL EXECUTIVE OFFICERS AS A GROUP, INCLUDING THE OFFICERS LISTED
 ABOVE (8 PERSONS)(3)                                                      300,000               1,125,000.00

WILLIAM ISAIAS,                                                             10,000                  37,500.00
 Director and Nominee for Director

JOHN H. BLAKE,                                                              10,000                  37,500.00
 Director and Nominee for Director

FERNANDO TAMAYO,                                                            10,000                  37,500.00
 Director and Nominee for Director

ALL CURRENT DIRECTORS WHO ARE NOT EXECUTIVE OFFICERS AS A GROUP,
 INCLUDING THE DIRECTORS LISTED ABOVE (6 PERSONS)(3)(4)                     60,000                 225,000.00

ALL EMPLOYEES AS A GROUP, OTHER THAN EXECUTIVE OFFICERS
 (14 PERSONS)(4)(5)                                                         90,000                 337,500.00
</TABLE>

- ----------------
(1) Based on a closing price for the Corporation's Common Stock of $18.75 at
    April 14, 1998.

(2) None of the options were exercisable as of April 14, 1998. See preceding
    discussion on exercisability of options.

(3) Executive officers include Roberto Isaias, Chairman of the Board of the
    Corporation and Chairman of the Executive Committee and a director of the
    Bank.

(4) Does not include options for 10,000 shares each, or a total of 50,000
    shares, which have been granted to five directors of the Bank who are not
    directors of the Corporation or executive officers of the Corporation or
    of the Bank.

(5) Includes options for 5,000 shares granted to an individual who is no longer
    employed by the Bank and whose options will terminate as a result without
    vesting.


FEDERAL INCOME TAX EFFECTS


     INCENTIVE STOCK OPTIONS. Incentive stock options are stock options that
satisfy the various requirements under Section 422(b) of the Code. These
requirements include that the option must be granted pursuant to a plan that is
approved by shareholders, the option price must be no less than the

                                       6
<PAGE>

fair market value for a share on the date of grant (110% of such fair market
value if the optionee is a more than 10% shareholder), and the option must not
be exercisable for a period of more than ten years from the date of grant (5
years in the case of a more than 10% shareholder). Also, pursuant to Section
422(b) of the Code, an option will not qualify as an incentive stock option if
and to the extent that the aggregate fair market value of the stock (determined
at the date of grant) with respect to which incentive stock options first
become exercisable in any calendar year exceeds $100,000.


     Under the Code, an optionee generally is not subject to ordinary income
tax upon the grant or exercise of an incentive stock option and the Corporation
would not be entitled to any tax deduction with respect to the option. Upon the
sale of the stock, the difference between the amount realized from the sale and
the option price will be treated as a capital gain or loss. Such capital gain
or loss will be short term or long term depending upon whether the optionee
held his shares for at least one year from the date of his exercise of the
option. However, if the optionee disposes of the shares he acquires pursuant to
the exercise of an incentive stock option prior to the later (a) two (2) years
from the date on which option was granted or (b) one (1) year from the date on
which the option was exercised (in either event a "Disqualifying Disposition"),
the optionee would recognize ordinary income equal to the lesser of (a) the
amount by which the fair market value of the stock on the date of exercise
exceeded the option price, and (b) the actual gain on the sale of the stock.
The amount by which the amount realized from the sale of the stock differed
from the fair market value on the date of exercise would be taxable to the
optionee as a capital gain or loss. The amount of the optionee's capital gain
or loss would be long term or short term depending upon whether the optionee
held the shares for at least one (1) year from the date of exercise of the
option. In the event of a Disqualifying Disposition, the Corporation would be
entitled to a tax deduction equal to the amount of ordinary income recognized
by the optionee as a result of the Disqualifying Disposition.


     The amount by which the fair market value of the shares acquired at the
time of exercise of an incentive stock option exceeds the exercise price of
such shares under such option generally would be treated as an item of
adjustment included in the optionee's alternative minimum taxable income for
purposes of the alternative minimum tax for the year in which the option is
exercised. The alternative minimum tax, payable if and to the extent it exceeds
the regular income tax, is imposed at the rate of 26% of so much of "taxable
excess" as does not exceed $175,000, plus 28% of so much of "taxable excess" as
exceeds $175,000. "Taxable excess" is defined to mean the amount by which the
taxpayer's alternative minimum taxable income exceeds his exemption amount.
Alternative minimum taxable income generally means the taxpayer's taxable
income as normally calculated for federal income tax purposes, subject to
certain adjustments (including the one for income resulting from the exercise
of an incentive stock option). The exemption amount is $45,000 for joint
returns, $33,750 for non-married individuals and $22,500 for married
individuals filing separately.


     NON-QUALIFIED STOCK OPTIONS. A non-qualified stock option is any option
that does not qualify as an incentive stock option (including options that
would satisfy the requirements for incentive stock options, but for the fact
that they exceed the $100,000 per year dollar limitation). An optionee granted
a non-qualified stock option will not recognize any income as a result of the
granting of the option, unless the price is so low that the Internal Revenue
Service would not view the grant as a true option. The optionee will recognize
ordinary income at the time he exercises the option equal to the amount by
which the fair market value of the shares on the date of exercise exceeded the
option price. The amount so recognized is subject to federal withholding and
employment taxes. Upon sale of the stock, the optionee will recognize capital
gain or loss on the difference between the amount realized on the sale of the
stock and the fair market value on the date of exercise. The gain or loss will
be short or long term depending on whether the stock was held for at least one
(1) year after the exercise of the option. The Corporation would be entitled to
a tax deduction in the year on which the option is exercised equal to the
amount of ordinary income recognized by the optionee, that is, the amount of by
which the fair market value of the stock on the date of exercise exceeded the
option price.

     THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" THE
APPROVAL OF THE 1998 STOCK OPTION PLAN. PROXIES, UNLESS INDICATED TO THE
CONTRARY, WILL BE VOTED "FOR" THIS PROPOSAL.


                                       7
<PAGE>

              RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS

                (PROPOSAL NUMBER 3 ON THE ENCLOSED PROXY CARD)


     The accounting firm of Price Waterhouse LLP has been appointed the
Corporation's independent auditors for the year 1998 by the Board of Directors
on the recommendation of the Audit Committee. Such appointment does not require
ratification by the Corporation's shareholders, but, in accordance with past
practice, such appointment is being submitted to the shareholders for
ratification.


     The vote of the Corporation's shareholders in this meeting is advisory in
nature and has no effect upon the Board of Directors' appointment of an
auditor, and the Board of Directors may change the Corporation's auditors at
any time without the approval or consent of the shareholders.


     Price Waterhouse LLP has served as independent auditors of the Corporation
and the Bank since 1993. A representative of such firm is expected to attend
the Annual Meeting, respond to appropriate questions from shareholders and
proxyholders present at the Annual Meeting and if such representative desires,
which is not now anticipated, make a statement.


     THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" THE
RATIFICATION OF THE APPOINTMENT OF PRICE WATERHOUSE LLP AS INDEPENDENT AUDITORS
OF THE CORPORATION. PROXIES, UNLESS INDICATED TO THE CONTRARY, WILL BE VOTED
"FOR" THIS PROPOSAL.


                              BOARD OF DIRECTORS


     Set forth below is certain information with respect to each of the three
nominees to serve as Class I directors, all of whom currently serve as
directors of the Corporation, and the six incumbent directors who will be
continuing in office following the Annual Meeting. Except for Estefano Isaias
and William Isaias, all nominees and continuing directors serve also as
directors of the Bank.


CLASS I NOMINEES FOR ELECTION TO TERMS EXPIRING IN 2001


     JOHN H. BLAKE (AGE 52) has been a director of the Corporation since 1997.
He has been the President of A.I. Risk Specialists, Inc., an insurance agency,
since January 1995. From June 1994 to December 1994, he was General Manager of
Northwest Brokers, a reinsurance broker doing business in Latin America. From
November 1992 to June 1994, Mr. Blake worked as a consultant to banks and
insurance companies. Mr. Blake has previously served several one year terms as
a director of the Corporation, as the Corporation had historically rotated two
director positions among the directors of the Bank, and has served as a
director of the Bank since 1986.


     WILLIAM ISAIAS (AGE 54) has been a director of the Corporation since 1987.
He has served as Executive Vice-President of Filanbanco, S.A., a major
Ecuadorian bank since 1988. He was General Manager of the Quito, Ecuador branch
office of Filanbanco, S.A. from 1984 to 1988 and has been a director of
Indulana, S.A., a textile manufacturing corporation in Ecuador, since 1984. Mr.
Isaias is the brother of directors Roberto and Estefano Isaias.


     FERNANDO TAMAYO (AGE 48) has been a director of the Corporation since
1997. Since May 1986, he has been President of Southern Industrial Sales Corp.,
a corporation engaged in export of sugar mill equipment to Latin America. Mr.
Tamayo has previously served a one year term as a director of the Corporation,
as the Corporation had historically rotated two director positions among the
directors of the Bank, and has served as a director of the Bank since 1995.


INCUMBENT CLASS II DIRECTORS--TERMS EXPIRING IN 1999


     JOSE P. BARED (AGE 56) has been a director of the Corporation since 1997.
Since August 1992, Mr. Bared has been the Chief Executive Officer of Farm
Stores. From 1977 to 1992, he was Chief


                                       8
<PAGE>

Executive Officer and President of Bared & Co., Inc., an electrical and
mechanical engineering contracting firm. Mr. Bared previously served several
one-year terms as a director of the Corporation, as the Corporation had
historically rotated two director positions among directors of the Bank, and
has served as director of the Bank since 1972.


     ESTEFANO ISAIAS (AGE 49) has been a director of the Corporation since
1982. He has served as President of Seguros Rocafuerte, an Ecuadorian insurance
corporation, since September 1985, as President of Emilio Isaias C.A. de
Comercio, an Ecuadorian corporation, since January 1980, as President of
Compania Minera Gribipe, an Ecuadorian mining corporation, since June 1994 and
as President of General Fruit, S.A., a corporation engaged in the fruit
exporting business, since March 1995. Mr. Isaias has served as a director of
Filanbanco, S.A., a major Ecuadorian bank, since June 1980. Mr. Isaias is the
brother of directors William and Roberto Isaias.


     MILTON H. LEHR (AGE 79) has been a director of the Corporation since 1997.
He has been the owner of the American Travel Club of Miami, a corporation
specializing in the organization of travel tours, since December 1978 and has
been the co-publisher of "In Spain" magazine since July 1979. From November
1959 until February 1993, Mr. Lehr served as President of International Video
Affiliates, a corporation specializing in the sale of television films. He has
previously served several one-year terms as a director of the Corporation, as
the Corporation has historically rotated two director positions among directors
of the Bank, and has served as a Director of the Bank since 1976.


INCUMBENT CLASS III DIRECTORS--TERMS EXPIRING IN 2000


     BERNARDO M. ARGUDIN (AGE 46) has been a director of the Corporation since
1997 and Vice President and Chief Financial Officer of the Corporation since
April 1992. Mr. Argudin has served as a director of the Bank since April 1997.
He has served as Executive Vice President of the Bank since March 1994, and as
Chief Financial Officer of the Bank since March 1992. From May 1988 to April
1992, Mr. Argudin served as Comptroller of the Bank. He was first employed by
the Bank in February 1986 as a Loan Review Officer, and served in that capacity
until May 1988. From May 1982 to June 1985, Mr. Argudin served as Comptroller
of FGS, Inc., a bank holding corporation located in Inverness, Florida. Mr.
Argudin worked as a national bank examiner with the Office of the Comptroller
of the Currency from June 1973 to May 1982.


     OSCAR BUSTILLO, JR. (age 54) has been a director of the Corporation since
1989 and President and Chief Executive Officer of the Corporation since April
1994. Since March 1989, he has served as an officer of the Corporation. Mr.
Bustillo has served as President of the Bank since February 1989, as Chief
Executive Officer of the Bank since May 1993, as Chairman of the Board of
Directors of the Bank since April 1995 and as a director since February 1989.
From April 1985 to February 1989, Mr. Bustillo served as Senior Vice President
of the Bank and headed its International Division. From May 1980 to May 1985,
Mr. Bustillo served as Vice President of the Bank of New England. During the
period from January 1975 to May 1980, Mr. Bustillo served as Assistant Vice
President in the Latin American Division of Irving Trust International.


     ROBERTO ISAIAS (AGE 53) has been a director of the Corporation since 1970
and Chairman of the Board of Directors since May 1982. Mr. Isaias has served as
a director of the Bank since October 1984 and as Chairman of the Executive
Committee of the Bank since March 1985. Since 1985, Mr. Isaias has served as
President of Filanbanco, S.A., a major Ecuadorian bank. From 1971 to 1985, Mr.
Isaias was employed in various capacities at Filanbanco, S.A. Mr. Isaias is the
brother of directors William and Estefano Isaias.


COMMITTEES OF THE BOARD OF DIRECTORS AND ATTENDANCE


     The Corporation has an Audit Committee, Compensation Committee and an
Executive Committee.


     AUDIT COMMITTEE. The Audit Committee reviews the general scope of the
audit conducted by the Corporation's independent auditors and matters relating
to the Corporation's internal control systems.


                                       9
<PAGE>

In performing its functions, the Audit Committee meets separately with
representatives of the Corporation's independent auditors and with
representatives of senior management. The members of the Audit Committee are
Messrs. John H. Blake and Milton H. Lehr. The Audit Committee was established
in November 1997 and its initial members were appointed in December 1997. The
Audit Committee did not hold any meetings in 1997. The Bank also has an Audit
Committee.


     COMPENSATION COMMITTEE. The Compensation Committee is responsible for
making recommendations to the Board of Directors with respect to the
compensation of the Corporation's executive officers and with respect to the
establishment of policies dealing with various compensation and employee
benefit matters. The Compensation Committee also administers the Plan and makes
recommendations to the Board of Directors as to option grants under the Plan.
The members of the Compensation Committee are Messrs. Jose P. Bared and
Fernando Tamayo. All matters approved by the Compensation Committee must also
be approved by the Board of Directors. The Compensation Committee was
established in November 1997 and its initial members were appointed in December
1997. The Compensation Committee held one meeting in 1997.


     EXECUTIVE COMMITTEE. The Executive Committee is authorized, between
meetings of the Board of Directors, to perform all duties and exercise all
authority of the Board of Directors, except for those duties and authorities
exclusively reserved by law to the Board of Directors. The Executive Committee
is currently comprised of Messrs. Roberto Isaias, Oscar Bustillo, Jr. and
Bernardo Argudin. The Executive Committee did not hold any meetings in 1997.


     ATTENDANCE. The Board of Directors of the Corporation held six meetings in
1997. In 1997, all of the directors attended at least 75% of the aggregate of
the meetings of the Board of Directors of the Corporation and the above
committees on which they served during the period they were directors and
members of such committees.


COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION


     The Corporation does not have any employees. Prior to the formation of the
Compensation Committee, matters related to compensation and employee benefit
matters of the Bank were considered by Mr. Roberto Isaias, the Chairman of the
Executive Committee of the Bank and by Mr. Oscar Bustillo, Jr., Chief Executive
Officer and President of the Bank. Mr. Bustillo participated in determinations
as to compensation for executive officers, including himself. Final
determinations regarding compensation were made by the Board of Directors of
the Bank and/or of the Corporation. Mr. Bernardo Argudin, Vice President and
Chief Financial Officer of the Corporation and Executive Vice President and
Chief Financial Officer of the Bank, serves on the Board of Directors of the
Corporation and the Bank. Mr. Felix Garcia, Executive Vice President and Chief
Credit Officer of the Bank, serves on the Board of Directors of the Bank. Mr.
Argudin was present during the deliberations of the Board of the Corporation
and the Bank and Mr. Garcia was present during the deliberations of the Board
of the Bank regarding compensation to executive officers.


     Roberto Isaias, the Chairman of the Board of the Corporation and the
Chairman of the Executive Committee and a director of the Bank, is a director
and president of three corporations which constitute one of two general
partners of each of three partnerships doing business as Farm Stores, of which
Jose P. Bared, a director of the Corporation and the Bank and a member of the
Compensation Committee, is the Chief Executive Officer.


     In connection with the construction of headquarters and office building in
Coral Gables, Florida, the Bank entered into a contract in April 1995 with a
contractor to provide mechanical work for a total initial contract amount of
$3.5 million. Members of the family of Jose P. Bared, a director of the
Corporation and the Bank and a member of the Compensation Committee, are
principals of the contractor. Through December 31, 1997, a total of $4.41
million had been paid by the Bank to the contractor, including change orders to
the original contract, $855,000 of which was paid in 1997. This contract was
awarded under a sealed bid.


                                       10
<PAGE>

     Options to purchase 10,000 shares of Common Stock have been granted to
each of Messrs. Bared and Tamayo. See "Approval of the 1998 Stock Option Plan."
 


DIRECTOR COMPENSATION


     Prior to February 1998, members of the Board of Directors of the
Corporation received a fee in the amount of $100 per meeting attended.
Beginning in February 1998, members of the Corporation's Board of Directors,
other than executive officers and directors of the Bank, have received a
monthly retainer of $1,000. Each director of the Corporation, other than
executive officers, receives a fee of $300 for each committee meeting attended.
The Corporation will continue to reimburse all directors of the Corporation for
all travel-related expenses incurred in connection with their activities as
directors. For the year ended December 31, 1997 the Corporation and the Bank
paid an aggregate of $170,900 in fees to its directors and $41,589 in travel
allowances. The Corporation and the Bank also provide each director with the
option to participate in the Bank's self-insured health plan on the same cost
basis as employees.


     Each director of the Corporation and the Bank, other than Messrs.
Bustillo, Garcia and Argudin, have received non-qualified options to purchase
10,000 shares, or an aggregate of 120,000 shares, at a price of $15.00 per
share. All such options have ten year terms and will be exercisable beginning
six months after the date of the grant, except for options granted to Mr.
Tamayo and Ms. Betancourt, which will be exercisable in 20% increments
beginning on the second anniversary of the grant. See "Approval of the 1998
Stock Option Plan."


                                       11
<PAGE>

        SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT


     Based upon information available to the Corporation, the following table
sets forth the number of shares of Common Stock owned beneficially as of April
14, 1998 by (i) each person who is known by the Company to own beneficially
more than 5% of the Common Stock; (ii) each director and nominee for director;
(iii) the Named Officers (see "Executive Compensation"); and (iv) all of the
directors and executive officers as a group:

<TABLE>
<CAPTION>
                                                                    PERCENT OF
NAME AND ADDRESS                            NUMBER OF SHARES       OUTSTANDING
OF BENEFICIAL OWNER                      BENEFICIALLY OWNED(1)     COMMON STOCK
- -------------------                      ---------------------     ------------
<S>                                     <C>                       <C>
Rebank Netherlands Antilles N.V.(2)           11,959,030               56.9%
c/o Amaco (Curacao), N.V.
P.O. Box 3141
Curacao, Netherlands Antilles

Roberto Isaias(3)                             12,535,580               59.6
Apartado 149
Guayaquil, Ecuador

Estefano Isaias(4)                            12,533,180               59.6
Apartado 149
Guayaquil, Ecuador

Mariela Isaias(5)                             11,959,030               56.9
Apartado 149
Guayaquil, Ecuador

William Isaias(6)                             12,540,285               59.6
Apartado 149
Guayaquil, Ecuador

Investors Overseas Limited, Inc.               1,294,640                6.2
c/o Morgan & Morgan
Torre Swiss Bank Building
P.O. Box 1824, 16th Floor
Panama 1, Rep. of Panama

True Flight Investors, Ltd.                    1,080,317                5.1
c/o HWR Services Limited
Craigmuir Chambers
P.O. Box 71
Road Town
Tortola, British Virgin Islands

Jose P. Bared(7)                                  58,742                  *
Farm Stores
5800 N.W. 74th Avenue
Miami, Florida 33166

John H. Blake(8)                                   7,662                  *
A.I. Risk Specialist, Inc.
Douglas Center
Suite 1010
2600 Douglas Road
Coral Gables, Fl. 33134
</TABLE>

                                       12
<PAGE>


<TABLE>
<CAPTION>
                                                                    PERCENT OF
NAME AND ADDRESS                            NUMBER OF SHARES       OUTSTANDING
OF BENEFICIAL OWNER                      BENEFICIALLY OWNED(1)     COMMON STOCK
- -------------------                      ---------------------     ------------
<S>                                    <C>                       <C>
Milton H. Lehr(9)                                  9,375                 *
8440 S.W. 104th Street
Miami, Fl. 33156

Fernando Tamayo(10)                                4,460                 *
4950 S.W. 72nd Avenue
Suite 112
Miami, Fl. 33155

Oscar Bustillo Jr.(11)                            21,902                 *
2800 Ponce de Leon Blvd.
Coral Gables, Fl. 33134

Bernardo M. Argudin(12)                           20,250                 *
2800 Ponce de Leon Blvd.
Coral Gables, Fl. 33134

Felix M. Garcia(13)                               12,200                 *
2800 Ponce de Leon Blvd.
Coral Gables, Fl. 33134

Fernando J. Martinez(14)                           8,092                 *
2800 Ponce de Leon Blvd.
Coral Gables, Fl. 33134

Rafael Quintana(15)                                7,000                 *
2800 Ponce de Leon Blvd.
Coral Gables, Fl. 33134

ALL DIRECTORS OF THE CORPORATION
  AND EXECUTIVE OFFICERS AS A GROUP
  INCLUDING THOSE LISTED ABOVE--
  14 PERSONS(16)                              12,696,735              60.4%
</TABLE>

- ----------------
 *  Less than 1%.
 (1) The nature of the reported beneficial ownership is unshared voting power
     and investment power unless otherwise indicated.
 (2) Each of Roberto and William Isaias owns one-third of the shares of Rebank
     and Estefano and Mariela Isaias, husband and wife, jointly own the
     remaining one-third of the shares of Rebank. Roberto, Estefano and William
     Isaias are brothers. The shares of Common Stock owned by the Isaiases
     through their ownership of Rebank are included in calculating the shares
     beneficially owned by Roberto, Estefano, Mariela and William Isaias.
 (3) Includes 11,959,030 held by Rebank, 574,150 shares jointly held by
     Roberto, Estefano and William Isaias and 2,400 shares held by Roberto
     Isaias individually. Does not include 10,000 shares of Common Stock
     subject to options granted effective February 11, 1998, which options will
     not be exercisable within 60 days from April 14, 1998.
 (4) Includes 11,959,030 held by Rebank and 574,150 shares jointly held by
     Roberto, Estefano and William Isaias. Does not include 10,000 shares of
     Common Stock subject to options granted effective February 11, 1998, which
     options will not be exercisable within 60 days from April 14, 1998.
 (5) Includes 11,959,030 held by Rebank. Does not include 574,150 shares
     jointly held by Roberto, Estefano and William Isaias.
 (6) Includes 11,959,030 held by Rebank, 574,150 shares jointly held by
     Roberto, Estefano and William Isaias and 7,105 shares held jointly by
     William Isaias and his wife. Does not include 10,000 shares of Common
     Stock subject to options granted effective February 11, 1998, which
     options will not be exercisable within 60 days from April 14, 1998.
 (7) Includes 54,000 shares held as trustee for his adult children and 4,742
     shares held individually by Mr. Bared. Does not include 10,000 shares of
     Common Stock subject to options granted effective February 11, 1998, which
     options will not be exercisable within 60 days from April 14, 1998.
 (8) Includes 250 shares held in trust for his adult son, 2,000 shares held in
     trust for his mother and 5,412 shares held individually. Does not include
     10,000 shares of Common Stock subject to options granted effective
     February 11, 1998, which options will not be exercisable within 60 days
     from April 14, 1998.
 (9) Does not include 10,000 shares of Common Stock subject to options granted
     effective February 11, 1998, which options will not be exercisable within
     60 days from April 14, 1998.


                                       13
<PAGE>

(10) Does not include 10,000 shares of Common Stock subject to options granted
     effective February 11, 1998, which options will not be exercisable within
     60 days from April 14, 1998.
(11) Includes 19,502 shares owned jointly with his wife, Virginia, and 2,400
     shares held individually. Does not include 100,000 shares of Common Stock
     subject to options granted effective February 11, 1998, which options will
     not be exercisable within 60 days from April 14, 1998.
(12) Includes 14,250 shares owned jointly with his wife, Cynthia, and 6,000
     shares held by his wife as custodian for their minor children under the
     Florida Gifts to Minors Act. Does not include 50,000 shares of Common
     Stock subject to options granted effective February 11, 1998, which
     options will not be exercisable within 60 days from April 14, 1998.
(13) Includes 500 shares owned jointly with his wife, Diana, 11,100 shares held
     individually and 600 shares jointly owned by his wife and his wife's
     daughter. Does not include 50,000 shares of Common Stock subject to
     options granted effective February 11, 1998, which options will not be
     exercisable within 60 days from April 14, 1998.
(14) Does not include 30,000 shares of Common Stock subject to options granted
     effective February 11, 1998, which options will not be exercisable within
     60 days from April 14, 1998.
(15) Shares listed are held in trust by Mr. Quintana for his adult children.
     Does not include 30,000 shares of Common Stock subject to options granted
     effective February 11, 1998, which options will not be exercisable within
     60 days from April 14, 1998.
(16) Listed shares do not include shares of Common Stock subject to options
     that were granted to all of the Directors and executive officers effective
     February 11, 1998 which options will not be exercisable within 60 days
     from April 14, 1998. See "Approval of the 1998 Stock Option Plan."


     Roberto Isaias, Estefano Isaias and William Isaias and Rebank have pledged
a majority of the outstanding shares of Common Stock of the Corporation to
SunTrust Bank, Miami, N.A. ("SunTrust") as security for loans granted by
SunTrust to the Isaiases. Roberto, Estefano, Mariela and William Isaias have
also pledged all of their shares of Common Stock in Rebank to SunTrust as
security for said loans. A default under said loans and the subsequent exercise
by SunTrust of its rights under the agreements evidencing or securing said
loans could result in a change in control of the Corporation.



                              EXECUTIVE OFFICERS


     Set forth below is certain information regarding executive officers of the
Corporation or the Bank.


     ROBERTO ISAIAS (AGE 53) is the Chairman of the Board of the Corporation
and Chairman of the Executive Committee and Director of the Bank. See
"Incumbent Class III Directors" for additional information.


     OSCAR BUSTILLO, JR. (AGE 54) is President, Chief Executive Officer and
Director of the Corporation and Chairman of the Board, Chief Executive Officer
and President of the Bank. See "Incumbent Class III Directors" for additional
information.


     BERNARDO M. ARGUDIN (AGE 46) is Vice President, Chief Financial Officer
and Director of the Corporation and Executive Vice President, Chief Financial
Officer and Director of the Bank. See "Incumbent Class III Directors" for
additional information.


     FELIX M. GARCIA (AGE 48) is Executive Vice President, Chief Credit Officer
and Director of the Bank. Mr. Garcia has served as an Executive Vice President
and as Head of the Credit Division of the Bank since January 1988, and as Chief
Credit Officer of the Bank since October 1992. He has served as a director of
the Bank since April 1997. From May 1986 to the present, Mr. Garcia has headed
the Bank's Credit Division. From April 1985 to May 1986 he served as Loan
Review Officer and as Senior Vice President for the Bank. Prior to joining the
Bank, Mr. Garcia served as an OCC field office manager from May 1982 to April
1985, and as an OCC national bank examiner from December 1972 to May 1982.


     EDWARD F. HOLDEN (AGE 45) is Executive Vice President--Corporate Banking
of the Bank. Mr. Holden has served as Executive Vice President--Corporate
Banking of the Bank since June 1997. From March 1992 until June 1997, Mr.
Holden served as Senior Vice President of the Bank and headed Corporate
Lending. Prior to joining the Bank, Mr. Holden served as a Vice President of
Southeast Bank, N.A. from January 1987 to April 1991. Before that, Mr. Holden
served as a Vice President of


                                       14
<PAGE>

Irving Business Center from February 1985 to January 1987. From April 1979 to
February 1985, Mr. Holden held a variety of positions with Irving Trust
International Bank, including that of Vice President. Mr. Holden held a variety
of positions with Southeast Bank, N.A. from January 1976 to July 1979.


     FERNANDO J. MARTINEZ (AGE 57) is Executive Vice President--Real Estate
Lending of the Bank. Mr. Martinez has served as Executive Vice President--Real
Estate Lending of the Bank since June 1997. During the period from August 1985
through June 1997, Mr. Martinez served as Senior Vice President of the Bank and
headed Commercial Real Estate Lending. Prior to joining the Bank, Mr. Martinez
served as Senior Vice President of Consolidated Bank, NA from January 1979 to
July 1985.


     RAFAEL QUINTANA (AGE 57) is Executive Vice President--Retail Banking of
the Bank. Mr. Quintana has served as Executive Vice President--Retail Banking
of the Bank since March 1994, and has headed the Bank's Retail Banking Division
since March 1992. Mr. Quintana joined the Bank as Senior Vice President in
January 1990, and headed the Bank's Marketing Department until March 1992. From
March 1975 to August 1989, Mr. Quintana held various positions with Amerifist
Savings, including that of Vice President. Mr. Quintana served as President of
Union Federal Savings and Loan Association from May 1974 to May 1975. Mr.
Quintana served as Vice President--Retail Banking of Amerifirst Savings from
March 1969 to March 1973.


     ORLANDO A. QUINTERO (AGE 63) is Executive Vice President--Operations of
the Bank. Mr. Quintero has served as Executive Vice President--Operations of
the Bank since January 1986. During the period from August 1972 through the
present, Mr. Quintero has held various positions in the Bank's Operations
Department. From January 1952 to December 1965, Mr. Quintero worked in various
capacities in banking operations in Cuba.


                                       15
<PAGE>

                            EXECUTIVE COMPENSATION

     The following table sets forth certain summary information concerning
compensation paid or accrued during the year ended December 31, 1997 to or on
behalf of (i)  the Chief Executive Officer of the Corporation (the "CEO") and
(ii) each of the four most highly paid executive officers of the Corporation or
of the Bank (the CEO and such executive officers are herein referred to as the
"Named Officers"). The Named Officers are all employees of the Bank and their
compensation is paid solely by the Bank.


                          SUMMARY COMPENSATION TABLE



<TABLE>
<CAPTION>
                                                                  ANNUAL COMPENSATION
                                                         --------------------------------------
                                                                                      OTHER            ALL
                                                                                     ANNUAL           OTHER
                                                           SALARY      BONUS      COMPENSATION     COMPENSATION
NAME & PRINCIPAL POSITIONS                       YEAR         $       $(1)(2)           $              $(5)
- --------------------------                      ------    ---------   ---------   --------------   -------------
<S>                                             <C>      <C>         <C>         <C>              <C>
OSCAR BUSTILLO, JR.                             1997     327,500      184,000              (3)        5,420
 Chief Executive Officer, President and
 director of the Corporation and Chairman
 of the Board, Chief Executive Officer and
 President of the Bank
                                                
FELIX M. GARCIA                                 1997     149,167       34,000              (3)        1,395
 Executive Vice President, Chief Credit
 Officer and director of the Bank
                                                
BERNARDO M. ARGUDIN                             1997     138,333       40,000              (3)        1,291
 Vice President, Chief Financial Officer and
 director of the Corporation and Executive
 Vice President, Chief Financial Officer and
 director of the Bank
                                                
FERNANDO J. MARTINEZ                            1997     140,016       31,000        49,912(4)        3,609
 Executive Vice President--Real Estate
 Lending of the Bank
                                                
RAFAEL QUINTANA                                 1997     139,166       30,000        17,316(4)        3,474
 Executive Vice President--Retail Banking
 of the Bank
</TABLE>

- ----------------
(1) Reflects bonus paid in March 1998 for 1997 performance.
(2) Does not include bonuses of $194,000, $38,000, $30,000, $23,000 and $37,000
    paid to Messrs. Bustillo, Garcia, Argudin, Martinez and Quintana,
    respectively, in March 1997 for 1996 performance.
(3) The aggregate amount of perquisites and other personal benefits provided to
    such Named Officer is less than the lesser of 10% of the total annual
    salary and bonus of such Named Officer or $50,000.
(4) Represents the amount paid to each of Messrs. Martinez and Quintana to
    compensate each of them for club initiation fees and annual dues.
(5) Represents the dollar value of premiums paid by the Company for term life
    insurance.


REPORT ON EXECUTIVE COMPENSATION AND COMPENSATION OF CHIEF EXECUTIVE OFFICER


     The rules of the Securities and Exchange Commission require that a report
be provided discussing the Compensation Committee's policies applicable to the
Corporation's executive officers. The compensation of the executive officers
for 1997 (other than the amount of their individual bonuses) and the amount of
the bonus pool distributed among the Bank's employees, including executive
officers, were determined prior to the consummation of the initial public
offering of the Corporation's securities and the establishment of the
Compensation Committee of the Board of Directors of the Corporation. Matters
related to compensation and employee benefits during 1997 were considered by
Mr. Roberto Isaias, the Chairman of the Executive Committee of the Bank and by
Mr. Bustillo, Chief Executive Officer and President of the Bank (see "Board of
Directors--Compensation Committee Interlocks and


                                       16
<PAGE>

Insider Participation") and approved by the Board of Directors of the Bank and,
in the case of bonuses paid in 1998 in respect of 1997 performances, also by
the Board of Directors of the Corporation.


     The compensation policies of the Bank focus on the need to retain and
attract key executives, the performance of the Bank, individual performance and
the desire to remain competitive with other South Florida institutions. In
reviewing the Bank's performance primary consideration is given to growth in
assets and earnings. The analysis of these factors is by nature subjective.
Salaries of executive officers are based primarily upon position with the Bank,
the person's responsibilities and importance to the Bank, performance and
external comparisons. The Corporation and the Bank have not obtained formal
compensation surveys but rely on the experience of their directors. An
executive officer's prior salary and history with the bank is also taken into
consideration. Salaries generally have increased moderately in recent years. In
the case of two executive officers, salary increases during 1997 also reflected
additional responsibilities given to such officers.


     Effective January 1, 1998, and prior to the consummation of the initial
public offering of the Corporation's securities, the Bank entered into
employment agreements with nine senior officers, including Mr. Bustillo and all
other executive officers (see "Employment Agreements" below). Such employment
agreements provide that the officer will receive a base salary equal to the
base salary in effect prior to the execution of the agreement, subject to
annual review for potential increases. Such employment agreements provide also
that the officers would be eligible to receive additional annual incentive
compensation based on individual and the Bank's performance. The employment
agreements were approved by the Compensation Committee and the Board of
Directors of the Corporation.


     An important ingredient of executive compensation is incentive
compensation. The primary consideration in setting key incentive compensation
is performance of the Bank and the unit for which the officer is responsible
and individual performance. It has been generally the practice of the Bank to
have Mr. Bustillo set individual goals for executive officers. The achievement
of such goals becomes a key component of the determination of incentive
compensation. Other factors considered include the delegation of additional
duties or responsibilities to the officer during the course of the year. No
particular weight is given to any one of these factors and the determination of
the incentive compensation given to each officer remains a subjective one.


     Historically, pursuant to the Bank's bonus policy, which has been approved
by the Bank's Board of Directors and administered by the Bank's Chief Executive
Officer, the Bank has distributed an aggregate of 5 to 6% of the Bank's pre-tax
net income, before deduction of the bonus pool, to its executive officers and
other employees as bonuses. Historically, employees and executive officers of
the Corporation have received approximately 80% and 20% of the bonus pool,
respectively. For the year ended December 31, 1997, approximately $1,435,000
was distributed pursuant to the Bank's bonus pool, including the bonuses set
forth in the above table. Bonuses in respect of 1997 performance were awarded
in March 1998 under the bonus pool policy of the Bank. The amount of the bonus
awarded to each executive officer was recommended by Mr. Roberto Isaias and Mr.
Bustillo and approved by the Board of Directors of the Corporation and the
Bank. In certain instances, executive officers were awarded bonuses of a lesser
amount than in 1996, reflecting the fact that certain corporate objectives for
1997 were not met.


     The Chief Executive Officer's compensation is based upon the policies and
objectives discussed above. Mr. Bustillo's salary reflects his importance to
the success of the Bank. His compensation is believed to be competitive with
that of other chief executive officers of banks of a similar size in the South
Florida area, although no formal studies have been made. Mr. Bustillo's bonus
is evaluated in light of the Bank's performance during the year. Mr. Bustillo's
bonus of $184,000 was consistent with the satisfactory results achieved by the
Bank during 1997 and the belief by the Board of Directors of the Corporation
that Mr. Bustillo continues to perform his duties well. His bonus for 1997
represents a slight decrease from the bonus paid to Mr. Bustillo in respect of
1996, as certain corporate objectives for 1997 were not met. The determination
of his salary and bonus is subjectively made.


                                       17
<PAGE>

  BERNARDO M. ARGUDIN, JOSE P. BARED, JOHN H. BLAKE, OSCAR BUSTILLO JR.,
  ESTEFANO ISAIAS, ROBERTO ISAIAS, WILLIAM ISAIAS, MILTON H. LEHR, AND
  FERNANDO TAMAYO


GRANTS OF STOCK OPTIONS AND STOCK APPRECIATION RIGHTS; EXERCISE OF STOCK
OPTIONS


     The Corporation did not grant any stock options or stock appreciation
rights during 1997 and no stock options were exercised during 1997. For stock
options granted since January 1, 1998, see "Approval of the 1998 Stock Option
Plan."


PENSION PLAN


     The Bank has a tax-qualified non-contributory defined benefit pension plan
covering substantially all full time employees of the Bank, including the Named
Officers (the "Pension Plan").


     The following table sets forth the total estimated annual pension benefits
payable to a covered participant who retired from service with the Bank in 1997
at age 65 and had attained the earnings and years of service classifications
specified under the Pension Plan, based upon compensation covered under the
pension plan ("covered compensation") and years of service with the Bank
credited under the pension plan ("Credited Service"):


                              PENSION PLAN TABLE

<TABLE>
<CAPTION>
                                                YEARS OF CREDITED SERVICE
                              -------------------------------------------------------------
FINAL AVERAGE COMPENSATION     15 YEARS     20 YEARS     25 YEARS     30 YEARS     35 YEARS
- ---------------------------   ----------   ----------   ----------   ----------   ---------
<S>                           <C>          <C>          <C>          <C>          <C>
$   125,000                    $39,725      $43,174      $46,624      $50,074      $53,524
$   150,000                     47,796       51,978       56,160       60,342       64,524
$   160,000                     51,025       55,499       59,974       64,449       68,924
</TABLE>

     Benefits shown above are computed as a single life annuity and are not
subject to any deduction for Social Security or other offset amounts. "Final
Average Compensation" is a participant's average annual compensation over the
five consecutive years in the most recent ten years yielding the highest
average annual compensation. A participant's covered compensation includes all
annual compensation reported in the Summary Compensation Table, but is subject
to certain limitations on compensation under the Internal Revenue Code.


     Estimated years of Credited Service for each of the following officers as
of December 31, 1997 are as follows: Oscar Bustillo, Jr.--13 years; Felix M.
Garcia--13 years; Bernardo M. Argudin--12 years; Fernando J. Martinez--13
years; Rafael Quintana--8 years. Covered compensation for all Named Officers
was $160,000 each for the fiscal year ended December 31, 1997, which was the
limit of covered compensation in 1997 under applicable law.


EMPLOYMENT AGREEMENTS


     Effective January 1, 1998, the Bank entered into employment agreements
with nine senior officers, including each of Oscar Bustillo, Jr., President and
Chief Executive Officer of the Corporation and the Bank, Felix M. Garcia,
Executive Vice President and Chief Credit Officer of the Bank, Bernardo M.
Argudin, Vice President and Chief Financial Officer of the Corporation and
Executive Vice President and Chief Financial Officer of the Bank, Fernando J.
Martinez, Executive Vice President--Real Estate Lending of the Bank and Rafael
Quintana, Executive Vice President--Retail Banking of the Bank. Each of the
agreements is for a term to expire on December 31, 2000. Under the terms of the
agreements, Messrs. Bustillo, Garcia, Argudin, Martinez and Quintana, are
entitled to receive base salaries equal to their base salaries prior to the
agreements of $330,000, $150,000, $140,000, $150,000 and $145,000,
respectively, subject to annual review for potential increases. These
employment agreements provide that Messrs. Bustillo, Garcia, Argudin, Martinez
and Quintana are eligible to receive additional annual incentive compensation
based on individual and the Bank's performance, as


                                       18
<PAGE>

may be awarded by the Compensation Committee and approved by the Board.
Pursuant to the employment agreements, the Bank will make lump sum payments to
Messrs. Bustillo, Garcia, Argudin, Martinez and Quintana if there is a change
in control of the Bank, and if they do not voluntarily terminate their
employment with the Bank for a three month period following consummation of the
change in control. Messrs. Bustillo, Garcia and Argudin would each be entitled
to an aggregate amount equal to two times the annual base salary he would be
entitled to receive under the agreement, plus an aggregate amount equal to two
times the incentive compensation received for the fiscal year immediately
preceding the change in control. Messrs. Martinez and Quintana would each be
entitled to an amount equal to the annual base salary he would be entitled to
receive under the agreement, plus an aggregate amount equal to the incentive
compensation received for the fiscal year immediately preceding the change in
control. The agreements contain confidentiality provisions and prohibit Messrs.
Bustillo, Garcia, Argudin, Martinez and Quintana from competing with the Bank
during the period of employment and for a period of one year after voluntary
termination of employment.



CERTAIN TRANSACTIONS


     From time to time, the Bank makes loans and extends credit to the Bank's
officers, directors, employees and to certain companies affiliated with such
persons. In the opinion of the Corporation, all of such loans and extensions of
credit were made in the ordinary course of business, on substantially the same
terms, including interest rates and collateral, as those prevailing at the time
for comparable transactions with unrelated persons entered into on an arm's
length basis and did not involve more than the normal risk of collectibility.
At December 31, 1997, an aggregate of $1.9 million of loans and extensions of
credit were outstanding to the existing executive officers and directors of the
Corporation and the Bank and to certain companies affiliated with such persons.
 


     In connection with the construction of a headquarters and office building
in Coral Gables, Florida, the Bank entered into a contract in April 1995 with a
contractor to provide mechanical work for a total initial contract amount of
$3.5 million. Members of the family of Jose P. Bared, a director of Corporation
and the Bank, are principals of the contractor. Through December 31, 1997 a
total of $4.41 million had been paid by the Bank to the contractor, including
change orders to the original contract, $855,000 of which was paid in 1997.
This contract was awarded under a sealed bid.


     For the year ended December 31, 1997 the Bank has paid fees for courier
and pouch support services of $58,004 to Filanbanco, S.A., an Ecuadorian bank
of which Roberto Isaias is President and a director, William Isaias is
Executive Vice President and a director and Estefano Isaias is a director.


     In 1994, the Bank entered into an agreement to acquire a license to
customized software to support its teller operations from Infordatos, S.A., an
affiliate of Filanbanco, S.A. and of Roberto, Estefano and William Isaias.
Pursuant to the agreement, the Bank acquired a license for an indefinite
period, which would end only with a change in control in ownership of the Bank,
for a total license fee of $197,000, and without ongoing license payments. An
initial payment of $100,000 was made in 1994 and a final payment of $97,000 was
made in 1997 after all custom features were completed.


     In addition to federal law, the Bank's policy as it relates to certain
affiliates requires that transactions with its officers, directors or
affiliates be on terms no less favorable than those that could be obtained from
unrelated third parties. The Corporation believes that the foregoing
transactions were on terms no less favorable than those that could have been
obtained from unrelated third parties. Any transactions requiring approval of
the Bank's Board of Directors must be approved by a majority of the Bank's
disinterested directors. Currently, any such transaction in excess of $25,000,
if not otherwise required by law to be approved by the Board of Directors,
requires approval of the Bank's Executive Committee, and any such transaction
in excess of $75,000 requires approval of the Bank's Board of Directors.


                                       19
<PAGE>

                                 OTHER BUSINESS


     Management of the Corporation is not aware of any other matters which are
to be presented at the Annual Meeting but if any such matters are so presented
which may require a vote of the shareholders, the enclosed proxy shall be
deemed to confer discretionary authority to the individuals named as proxies
therein to vote the shares represented by such proxy as to any such matters.



                                 MISCELLANEOUS


PERFORMANCE GRAPH


     The shares of Common Stock of the Corporation were not publicly traded
prior to the completion of the initial public offering of the Corporation's
securities in February 1998. There was no active trading market in the
Corporation's stock prior to that time. Therefore, no graph of the performance
of the Corporation's Common Stock is included in this Proxy Statement.


SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE


     The Corporation did not have any class of equity securities registered
pursuant to Section 12 of the 1934 Securities Exchange Act of 1934, as amended,
during the fiscal year that ended on December 31, 1997, the Corporation's most
recent fiscal year. Accordingly, the directors and executive officers of the
Corporation and the owners of more than ten percent (10%) of any class of
equity securities of the Corporation were not required to file during said
fiscal year reports of ownership and changes in ownership with the Securities
and Exchange Commission.


SHAREHOLDER PROPOSALS


     Proposals of shareholders intended to be presented at the 1999 Annual
Meeting of shareholders of the Corporation (the "1999 Annual Meeting") must be
received by the Corporation at its offices at Republic Banking Corporation of
Florida, Office of the Secretary, 2800 Ponce de Leon Boulevard, Coral Gables,
Florida 33134, not later than December 21, 1998 in order to be considered for
inclusion in the Corporation's proxy statement and form of proxy relating to
the 1999 Annual Meeting. The submission of such proposals by shareholders and
the consideration of such proposals by the Corporation for inclusion in next
year's proxy statement and form of proxy are subject to applicable rules and
regulations of the Securities and Exchange Commission. In addition,
shareholders wishing to propose matters for consideration at the 1999 Annual
Meeting must follow certain specified advance notice procedures set forth in
the Corporation's Bylaws.


                                        By Order of the Board of Directors


                                        Lydia A. Fernandez, Secretary


April 27, 1998

                                       20
<PAGE>

                    REPUBLIC BANKING CORPORATION OF FLORIDA

                            1998 STOCK OPTION PLAN



     1. PURPOSE. The purpose of this Plan is to advance the interests of
Republic Banking Corporation Of Florida, a Florida corporation (the "Company"),
and its Subsidiaries by providing an additional incentive to attract and retain
qualified and competent persons who provide services to the Company and its
Subsidiaries, and upon whose efforts and judgment the success of the Company
and its Subsidiaries is largely dependent, through the encouragement of stock
ownership in the Company by such persons.


     2. DEFINITIONS. As used herein, the following terms shall have the meaning
indicated:


      (a) "Board" shall mean the Board of Directors of the Company.


      (b) "Committee" shall mean the committee appointed by the Board pursuant
to Section 13(a) hereof.


      (c) "Common Stock" shall mean the Company's Common Stock, par value $.01
per share.


      (d) "Director" shall mean a member of the Board.


      (e) "Fair Market Value" of a Share on any date of reference shall mean
the "Closing Price" (as defined below) of the Common Stock on the business day
immediately preceding such date, unless the Committee or the Board in its sole
discretion shall determine otherwise in a fair and uniform manner. For the
purpose of determining Fair Market Value, the "Closing Price" of the Common
Stock on any business day shall be (i) if the Common Stock is listed or
admitted for trading on any United States national securities exchange, or if
actual transactions are otherwise reported on a consolidated transaction
reporting system, the last reported sale price of Common Stock on such exchange
or reporting system, as reported in any newspaper of general circulation, (ii)
if the Common Stock is quoted on the National Association of Securities Dealers
Automated Quotations System ("NASDAQ"), or any similar system of automated
dissemination of quotations of securities prices in common use, the last
reported sale price of Common Stock on such system or, if sales prices are not
reported, the mean between the closing high bid and low asked quotations for
such day of Common Stock on such system, as reported in any newspaper of
general circulation or (iii) if neither clause (i) or (ii) is applicable, the
mean between the high bid and low asked quotations for the Common Stock as
reported by the National Quotation Bureau, Incorporated if at least two
securities dealers have inserted both bid and asked quotations for Common Stock
on at least five of the ten preceding days. If neither (i), (ii), or (iii)
above is applicable, then Fair Market Value shall be determined in good faith
by the Committee or the Board in a fair and uniform manner.


      (f) "Incentive Stock Option" shall mean an incentive stock option as
defined in Section 422 of the Internal Revenue Code.


      (g) "Internal Revenue Code" shall mean the Internal Revenue Code of 1986,
as amended from time to time.


      (h) "Non-Qualified Stock Option" shall mean an Option which is not an
Incentive Stock Option.


      (i) "Officer" shall mean the Company's Chairman of the Board, President,
Chief Executive Officer, principal financial officer, principal accounting
officer, any vice-president of the Company in charge of a principal business
unit, division or function (such as sales, administration or finance), any
other officer who performs a policy-making function, or any other person who
performs similar policy-making functions for the Company. Officers of
Subsidiaries shall be deemed Officers of the Company if

                                      A-1
<PAGE>

they perform such policy-making functions for the Company. As used in this
paragraph, the phrase "policy-making function" does not include policy-making
functions that are not significant. If pursuant to Item  401(b) of Regulation
S-K (17 C.F.R. \s. 229.401(b)) the Company identifies a person as an "executive
officer," the person so identified shall be deemed an "Officer" even though
such person may not otherwise be an "Officer" pursuant to the foregoing
provisions of this paragraph.


      (j) "Option" (when capitalized) shall mean any option granted under this
Plan.


      (k) "Optionee" shall mean a person to whom a stock option is granted
under this Plan or any person who succeeds to the rights of such person under
this Plan by reason of the death of such person.


      (l) "Outside Director" shall mean a member of the Board who qualifies as
an "outside director" under Section 162(m) of the Internal Revenue Code and the
regulations thereunder and as a "Non-Employee Director" under Rule 16b-3
promulgated under the Securities Exchange Act.


      (m) "Plan" shall mean this 1998 Stock Option Plan for the Company.


      (n) "Securities Exchange Act" shall mean the Securities Exchange Act of
1934, as amended from time to time.


      (o) "Share" shall mean a share of Common Stock.


      (p) "Subsidiary" shall mean any corporation (other than the Company) in
any unbroken chain of corporations beginning with the Company if, at the time
of the granting of the Option, each of the corporations other than the last
corporation in the unbroken chain owns stock possessing 50 percent or more of
the total combined voting power of all classes of stock in one of the other
corporations in such chain.


     3. SHARES AVAILABLE FOR OPTION GRANTS. The Committee, with the Board's
approval, may grant to Optionees from time to time Options to purchase an
aggregate of up to one million (1,000,000) Shares from the Company's authorized
and unissued Shares. If any Option granted under the Plan shall terminate,
expire, or be cancelled or surrendered as to any Shares, new Options may
thereafter be granted covering such Shares.


     4. INCENTIVE AND NON-QUALIFIED OPTIONS.


      (a) An Option granted hereunder shall be either an Incentive Stock Option
or a Non-Qualified Stock Option as determined by the Committee, with the
Board's approval, at the time of grant of such Option and shall clearly state
whether it is an Incentive Stock Option or a Non-Qualified Stock Option. All
Incentive Stock Options shall be granted within 10 years from the effective
date of this Plan. Incentive Stock Options may not be granted to any person who
is not an employee of the Company or any Subsidiary.


      (b) Options otherwise qualifying as Incentive Stock Options hereunder
will not be treated as Incentive Stock Options to the extent that the aggregate
fair market value (determined at the time the Option is granted) of the Shares,
with respect to which Options meeting the requirements of Section 422(b) of the
Internal Revenue Code are exercisable for the first time by any individual
during any calendar year (under all plans of the Company and its parent and
subsidiary corporations as defined in Section 424 of the Internal Revenue
Code), exceeds $100,000.


     5. CONDITIONS FOR GRANT OF OPTIONS.


      (a) Each Option shall be evidenced by an option agreement that may
contain any term deemed necessary or desirable by the Committee and the Board,
provided such terms are not inconsistent with this Plan or any applicable law.
Optionees shall be (i) those persons selected by the Committee and the


                                      A-2
<PAGE>

Board from the class of all regular employees of, or persons who provide
consulting or other services as independent contractors to, the Company or its
Subsidiaries, including Directors and Officers who are regular employees, and
(ii)) Directors who are not employees of the Company or of any Subsidiaries.
Any person who files with the Committee and the Board, in a form satisfactory
to the Committee and the Board, a written waiver of eligibility to receive any
Option under this Plan shall not be eligible to receive any Option under this
Plan for the duration of such waiver.


      (b) In granting Options, the Committee and the Board shall take into
consideration the contribution the person has made to the success of the
Company or its Subsidiaries and such other factors as the Committee and the
Board shall determine. The Committee and the Board shall also have the
authority to consult with and receive recommendations from officers and other
personnel of the Company and its Subsidiaries with regard to these matters. The
Committee, with the Board's approval, may from time to time in granting Options
under the Plan prescribe such other terms and conditions concerning such
Options as it deems appropriate, including, without limitation, (i) prescribing
the date or dates on which the Option becomes exercisable, (ii) providing that
the Option rights accrue or become exercisable in installments over a period of
years, or upon the attainment of stated goals or both, or (iii) relating an
Option to the continued employment of the Optionee for a specified period of
time, provided that such terms and conditions are not more favorable to an
Optionee than those expressly permitted herein.


      (c) The Options granted to employees under this Plan shall be in addition
to regular salaries, pension, life insurance or other benefits related to their
employment with the Company or its Subsidiaries. Neither the Plan nor any
Option granted under the Plan shall confer upon any person any right to
employment or continuance of employment by the Company or its Subsidiaries.


      (d) Notwithstanding any other provision of this Plan, an Incentive Stock
Option shall not be granted to any person owning directly or indirectly
(through attribution under Section 424(d) of the Internal Revenue Code) at the
date of grant, stock possessing more than 10% of the total combined voting
power of all classes of stock of the Company (or of its parent or subsidiary
corporation (as defined in Section 424 of the Internal Revenue Code) at the
date of grant) unless the option price of such Option is at least 110% of the
Fair Market Value of the Shares subject to such Option on the date the Option
is granted, and such Option by its terms is not exercisable after the
expiration of five years from the date such Option is granted.


      (e) Notwithstanding any other provision of this Plan, and in addition to
any other requirements of this Plan, the aggregate number of Options granted to
any one Optionee may not exceed 400,000, subject to adjustment as provided in
Section 10 hereof.


     6. OPTION PRICE. The option price per Share of any Option shall be any
price determined by the Committee, with the Board's approval, but shall not be
less than the Fair Market Value of the Share underlying such Option on the date
the Option is granted.


     7. EXERCISE OF OPTIONS. An Option shall be deemed exercised when (i) the
Company has received written notice of such exercise in accordance with the
terms of the Option, (ii)) full payment of the aggregate option price of the
Shares as to which the Option is exercised has been made, and (iii)
arrangements that are satisfactory to the Committee and the Board in their sole
discretion have been made for the Optionee's payment to the Company of the
amount that is necessary for the Company or Subsidiary employing the Optionee
to withhold in accordance with applicable Federal or state tax withholding
requirements. Unless further limited by the Committee and the Board in any
Option, and subject to such guidelines as the Committee and the Board may
establish, the option price of any Shares purchased shall be paid (1) in cash,
(2) by certified or official bank check, (3) by money order, (4) with Shares,
(5) by the withholding of Shares issuable upon exercise of the Option or by any
other form of cashless exercise procedure approved by the Committee with the
Board's approval, or (6) in such other consideration as the Committee and the
Board deems appropriate, or by a combination of the above. The Committee and
the Board in their sole discretion may accept a personal


                                      A-3
<PAGE>

check in full or partial payment of any Shares. If the exercise price is paid
in whole or in part with Shares, or through the withholding of Shares issuable
upon exercise of the Option, the value of the Shares surrendered or withheld
shall be their Fair Market Value on the date the Option is exercised. The
Company in its sole discretion may lend money to an Optionee, guarantee a loan
to an Optionee, or otherwise assist an Optionee to obtain the cash necessary to
exercise all or a portion of an Option granted hereunder or to pay any tax
liability of the Optionee attributable to such exercise. Such loans shall (i)
provide for full recourse to the maker, (ii) be collateralized by the pledge of
the Shares that the Optionee purchases upon exercise of such Option, (iii) bear
interest at no less than the prime rate of Republic National Bank of Miami,
(iv) contain such other terms as the Committee or the Board in their sole
discretion shall reasonably require, and (v) comply with all applicable laws
and regulations. No Optionee shall be deemed to be a holder of any Shares
subject to an Option unless and until a stock certificate or certificates for
such Shares are issued to such person(s) under the terms of this Plan. No
adjustment shall be made for dividends (ordinary or extraordinary, whether in
cash, securities or other property) or distributions or other rights for which
the record date is prior to the date such stock certificate is issued, except
as expressly provided in Section 10 hereof.


     8. EXERCISABILITY OF OPTIONS. Any Option shall become exercisable in such
amounts, at such intervals and upon such terms as the Committee or the Board
shall provide in such Option, except as otherwise provided in this Section 8.


      (a) The expiration date of an Option shall be determined by the
Committee, with the Board's approval, at the time of grant, but in no event
shall an Option be exercisable after the expiration of 10 years from the date
on which the Option is granted.


      (b) Except as provided in section 8(c), the Committee, with the Board's
approval, shall determine the vesting periods of the Options, but in no event
shall more than one third of any Option vest in less than one year, more than
two thirds of any Option vest in less than two years, and full vesting of any
Option shall not occur in less than three years,


      (c) Unless otherwise provided in any Option, each outstanding Option
shall become immediately fully exercisable in the event of a "Change in
Control" or in the event that the Committee, with the Board's approval,
exercises its discretion to provide a cancellation notice with respect to the
Option pursuant to Section 9(b) hereof. For this purpose, the term "Change in
Control" shall mean:


     (i) Approval by the shareholders of the Company of a reorganization,
   merger, consolidation or other form of corporate transaction or series of
   transactions, in each case, with respect to which persons who were the
   shareholders of the Company immediately prior to such reorganization,
   merger or consolidation or other transaction do not, immediately
   thereafter, own more than 50% of the combined voting power entitled to vote
   generally in the election of directors of the reorganized, merged or
   consolidated company's then outstanding voting securities, or a liquidation
   or dissolution of the Company or the sale of all or substantially all of
   the assets of the Company (unless such reorganization, merger,
   consolidation or other corporate transaction, liquidation, dissolution or
   sale is subsequently abandoned); or


     (ii) the acquisition (other than from the Company) by any person, entity
   or "group", within the meaning of Section 13(d)(e) or 14(d)(2) of the
   Securities Exchange Act, (excluding, for this purpose, the Company or its
   Subsidiaries, or any employee benefit plan of the Company or its
   Subsidiaries which acquires beneficial ownership (within the meaning of
   Rule 13d-3 promulgated under the Securities Exchange Act and excluding
   Rebank Netherlands Antilles N.V.)) of 51% or more of either the then
   outstanding shares of common stock or the combined voting power of the
   Company's then outstanding voting securities entitled to vote generally in
   the election of directors.


      (d) The Committee, with the Board's approval, may in its discretion,
accelerate the date on which any Option may be exercised and may accelerate the
vesting of any Shares subject to any Option or previously acquired by the
exercise of any Option.


                                      A-4
<PAGE>

     9. TERMINATION OF OPTION PERIOD. The unexercised portion of any Option
shall automatically and without notice terminate and become null and void at
the time of the earliest to occur of the following:


     (i) three months after the date on which the Optionee's employment is
   terminated or, in the case of a Non-Qualified Stock Option, and unless the
   Committee, with the Board's approval, shall otherwise determine in writing
   in their sole discretion, the date on which the Optionee's employment is
   terminated, in either case for any reason other than by reason of (A)
   cause, which, solely for purposes of this Plan, shall mean the termination
   of the Optionee's employment by reason of the Optionee's willful misconduct
   or gross negligence, (B) a mental or physical disability (within the
   meaning of Internal Revenue Code Section 22(e)) as determined by a medical
   doctor satisfactory to the Committee, or (C) death;


       (ii) immediately upon the termination of the Optionee's employment for
   Cause;


     (iii) twelve months after the date on which the Optionee's employment is
   terminated by reason of a mental or physical disability (within the meaning
   of Internal Revenue Code Section 22(e)) as determined by a medical doctor
   satisfactory to the Committee or the Board;


     (iv) (A) twelve months after the date of termination of the Optionee's
   employment by reason of death of the Optionee, or, if later, (B) three
   months after the date on which the Optionee shall die if such death shall
   occur during the one year period specified in Subsection 9(a)(iii) hereof.


All references herein to the termination of the Optionee's employment shall, in
the case of a Optionee who is not an employee of the Company or a Subsidiary,
refer to the termination of the Optionee's service with the Company.


      (b) To the extent not previously exercised, (i) each Option shall
terminate immediately in the event of (1) the liquidation or dissolution of the
Company, or (2) any reorganization, merger, consolidation or other form of
corporate transaction in which the Company does not survive, unless the
successor corporation, or a parent or subsidiary of such successor corporation,
assumes the Option or substitutes an equivalent option or right pursuant to
Section 10(c) hereof, and (ii) the Committee, with the Board's approval, in its
sole discretion may by written notice ("cancellation notice") cancel, effective
upon the consummation of any corporate transaction described in Subsection
8(c)(i) hereof in which the Company does survive, any Option that remains
unexercised on such date. The Committee, or the Board, shall give written
notice of any proposed transaction referred to in this Section 9(b) a
reasonable period of time prior to the closing date for such transaction (which
notice may be given either before or after approval of such transaction), in
order that Optionees may have a reasonable period of time prior to the closing
date of such transaction within which to exercise any Options that then are
exercisable (including any Options that may become exercisable upon the closing
date of such transaction). An Optionee may condition his exercise of any Option
upon the consummation of a transaction referred to in this Section 9(b).


     10. ADJUSTMENT OF SHARES.


      (a) If at any time while the Plan is in effect or unexercised Options are
outstanding, there shall be any increase or decrease in the number of issued
and outstanding Shares through the declaration of a stock dividend or through
any recapitalization resulting in a stock split-up, combination or exchange of
Shares, then and in such event:


     (i) appropriate adjustment shall be made in the maximum number of Shares
   available for grant under the Plan, or available for grant to any person
   under the Plan, so that the same percentage of the Company's issued and
   outstanding Shares shall continue to be subject to being so optioned; and


     (ii) appropriate adjustment shall be made in the number of Shares and the
   exercise price per Share thereof then subject to any outstanding Option, so
   that the same percentage of the Company's issued and outstanding Shares
   shall remain subject to purchase at the same aggregate exercise price.


                                      A-5
<PAGE>

      (b) Unless otherwise provided in any Option, the Committee, with the
Board's approval, may change the terms of Options outstanding under this Plan,
with respect to the option price or the number of Shares subject to the
Options, or both, when, in the Committee's, judgement, with the Board's
approval, such adjustments become appropriate so as to preserve but not
increase benefits under the Plan.


      (c) In the event of a proposed sale of all or substantially all of the
Company's assets or any reorganization, merger, consolidation or other form of
corporate transaction in which the Company does not survive, where the
securities of the successor corporation, or its parent company, are issued to
the Company's shareholders, then the successor corporation or a parent of the
successor corporation may, with the consent of the Committee, with the Board's
approval, assume each outstanding Option or substitute an equivalent option or
right. If the successor corporation, or its parent, does not cause such an
assumption or substitution to occur, or the Committee or the Board does not
consent to such an assumption or substitution, then each Option shall terminate
pursuant to Section 9(b) hereof upon the consummation of sale, merger,
consolidation or other corporate transaction.


      (d) Except as otherwise expressly provided herein, the issuance by the
Company of shares of its capital stock of any class, or securities convertible
into shares of capital stock of any class, either in connection with a direct
sale or upon the exercise of rights or warrants to subscribe therefor, or upon
conversion of shares or obligations of the Company convertible into such shares
or other securities, shall not affect, and no adjustment by reason thereof
shall be made to, the number of or exercise price for Shares then subject to
outstanding Options granted under the Plan.


      (e)  Without limiting the generality of the foregoing, the existence of
outstanding Options granted under the Plan shall not affect in any manner the
right or power of the Company to make, authorize or consummate (i) any or all
adjustments, recapitalizations, reorganizations or other changes in the
Company's capital structure or its business; (ii) any merger or consolidation
of the Company; (iii) any issue by the Company of debt securities, or preferred
or preference stock that would rank above the Shares subject to outstanding
Options; (iv) the dissolution or liquidation of the Company; (v) any sale,
transfer or assignment of all or any part of the assets or business of the
Company; or (vi) any other corporate act or proceeding, whether of a similar
character or otherwise.


     11. TRANSFERABILITY OF OPTIONS AND SHARES.


      (a) No Incentive Stock Option, and unless the prior written consent of
the Committee or the Board is obtained and the transaction does not violate the
requirements of Rule 16b-3 promulgated under the Securities Exchange Act no
Non-Qualified Stock Option, shall be subject to alienation, assignment, pledge,
charge or other transfer other than by the Optionee by will or the laws of
descent and distribution, and any attempt to make any such prohibited transfer
shall be void. Each Option shall be exercisable during the Optionee's lifetime
only by the Optionee, or in the case of a Non-Qualified Stock Option that has
been assigned or transferred with the prior written consent of the Committee,
with the Board's approval, only by the permitted assignee.


      (b) Unless the prior written consent of the Committee, with the Board's
approval, is obtained and the transaction does not violate the requirements of
Rule 16b-3 promulgated under the Securities Exchange Act, no Shares acquired by
an Officer or Director pursuant to the exercise of an Option may be sold,
assigned, pledged or otherwise transferred prior to the expiration of the
six-month period following the date on which the Option was granted.


     12. ISSUANCE OF SHARES.


      (a) Notwithstanding any other provision of this Plan, the Company shall
not be obligated to issue any Shares unless it is advised by counsel of its
selection that it may do so without violation of the applicable Federal and
State laws pertaining to the issuance of securities, and may require any stock
so issued to bear a legend, may give its transfer agent instructions, and may
take such other steps, as in its judgment are reasonably required to prevent
any such violation.


                                      A-6
<PAGE>

      (b) As a condition to any sale or issuance of Shares upon exercise of any
Option, the Committee, with the Board's approval, may require such agreements
or undertakings as the Committee, with the Board's approval, may deem necessary
or advisable to facilitate compliance with any applicable law or regulation
including, but not limited to, the following:


     (i) a representation and warranty by the Optionee to the Company, at the
   time any Option is exercised, that he is acquiring the Shares to be issued
   to him for investment and not with a view to, or for sale in connection
   with, the distribution of any such Shares; and


     (ii) a representation, warranty and/or agreement to be bound by any
   legends endorsed upon the certificate(s) for such Shares that are, in the
   opinion of the Committee or the Board, necessary or appropriate to
   facilitate compliance with the provisions of any securities laws deemed by
   the Committee or the Board to be applicable to the issuance and transfer of
   such Shares.


     13. ADMINISTRATION OF THE PLAN.


      (a) The Plan shall be administered by a committee appointed by the Board
(the "Committee") which shall be composed of two or more Directors all of whom
shall be Outside Directors. The membership of the Committee shall be
constituted so as to comply at all times with the applicable requirements of
Rule 16b-3 promulgated under the Securities Exchange Act and Section 162(m) of
the Internal Revenue Code. The Committee shall serve at the pleasure of the
Board and shall have the powers designated herein and such other powers as the
Board may from time to time confer upon it.


      (b) The Board may grant Options pursuant to this Plan to Directors who
are not employees of the Company or any Subsidiary and/or other persons to whom
Options may be granted under Section 5(a) hereof.


      (c) The Committee, with the Board's approval, from time to time, may
adopt rules and regulations for carrying out the purposes of the Plan. The
determinations by the Committee and the Board, and the interpretation and
construction of any provision of the Plan or any Option by the Committee and
the Board, shall be final and conclusive.


      (d) Any and all decisions or determinations of the Committee shall be
made either (i) by a majority vote of the members of the Committee at a meeting
or (ii) without a meeting by the written approval of the majority of the
members of the Committee.


     14. WITHHOLDING OR DEDUCTION FOR TAXES. If at any time specified herein
for the making of any issuance or delivery of any Option or Common Stock to any
Optionee or beneficiary, any law or regulation of any governmental authority
having jurisdiction in the premises shall require the Company to withhold, or
to make any deduction for, any taxes or take any other action in connection
with the issuance or delivery then to be made, such issuance or delivery shall
be deferred until such withholding or deduction shall have been provided for by
the Optionee or beneficiary, or other appropriate action shall have been taken.
 


     15. INTERPRETATION.


      (a) As it is the intent of the Company that the Plan comply in all
respects with Rule 16b-3 promulgated under the Securities Exchange Act ("Rule
16b-3"), any ambiguities or inconsistencies in construction of the Plan shall
be interpreted to give effect to such intention, and if any provision of the
Plan is found not to be in compliance with Rule 16b-3, such provision shall be
deemed null and void to the extent required to permit the Plan to comply with
Rule 16b-3. The Committee, with the Board's approval, may from time to time
adopt rules and regulations under, and amend, the Plan in furtherance of the
intent of the foregoing.


      (b) The Plan shall be administered and interpreted so that all Incentive
Stock Options granted under the Plan will qualify as Incentive Stock Options
under Section 422 of the Internal Revenue Code.


                                      A-7
<PAGE>

If any provision of the Plan should be held invalid for the granting of
Incentive Stock Options or illegal for any reason, such determination shall not
affect the remaining provisions hereof, but instead the Plan shall be construed
and enforced as if such provision had never been included in the Plan.


      (c) This Plan shall be governed by the laws of the State of Florida.


      (d) Headings contained in this Plan are for convenience only and shall in
no manner be construed as part of this Plan.


      (e) Any reference to the masculine, feminine, or neuter gender shall be a
reference to such other gender as is appropriate.


     16. AMENDMENT AND DISCONTINUATION OF THE PLAN. The Committee, with the
Board's approval, or the Board, may from time to time amend, suspend or
terminate the Plan or any Option; provided, however, that, any amendment to the
Plan shall be subject to the approval of the Company's shareholders if such
shareholder approval is required by any federal or state law or regulation
(including, without limitation, Rule 16b-3 or to comply with Section 162(m) of
the Internal Revenue Code) or the rules of any Stock exchange or automated
quotation system on which the Common Stock may then be listed or granted.
Except to the extent provided in Sections 9 and 10 hereof, no amendment,
suspension or termination of the Plan or any Option issued hereunder shall
substantially impair the rights or benefits of any Optionee pursuant to any
Option previously granted without the consent of the Optionee.


     17. EFFECTIVE DATE AND TERMINATION DATE. The effective date of the Plan is
January 1, 1998, and the Plan shall terminate on December 31, 2007. The Plan
shall be submitted to the shareholders of the Company for their approval and
adoption and Options hereunder may be granted prior to such approval and
adoption but contingent upon such approval and adoption.


                                      A-8

<PAGE>


                    REPUBLIC BANKING CORPORATION OF FLORIDA

                         ANNUAL MEETING OF SHAREHOLDERS

          THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

         The undersigned hereby appoints Milton H. Lehr and Bernardo M. Argudin
as proxies, each with power to appoint his substitute, and hereby authorizes
them to represent and vote, as designated on the reverse, all shares of Common
Stock of Republic Banking Corporation of Florida (the "Corporation") held of
record by the undersigned on April 14, 1998, at the Annual Meeting of
Shareholders to be held on May 20, 1998 and any adjournments thereof. THE BOARD
OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF DIRECTORS AND THE OTHER
PROPOSALS SET FORTH. THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE
MANNER DIRECTED HEREIN. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR"
ALL OF THE PROPOSALS.

                         (TO BE SIGNED ON REVERSE SIDE)

<PAGE>

A [X] PLEASE MARK YOUR 
      VOTES AS IN THIS
      EXAMPLE


<TABLE>
<CAPTION>
                        FOR         WITHHOLD
                        ALL        AUTHORITY
                     NOMINEES  FOR ALL NOMINEES                                                                FOR  AGAINST  ABSTAIN

<S>                                                                             <C>                                                 
1. To elect the three   [ ]            [ ]        Nominees:  John H. Blake      2. A proposal to approve the   [ ]     [ ]      [ ] 
   nominees named                                            William Isaias        1998 Stock Option Plan, as
   at right as directors                                     Fernando Tamayo       set forth in Appendix A to
   of the Corporation                                                              the Proxy Statement:
   to serve as Class I directors 
   with terms expiring at the 2001                                              3. A proposal to ratify the    [ ]     [ ]      [ ] 
   Annual Meeting of Shareholders or                                               appointment of Price 
   until their successors are                                                      Waterhouse LLP as auditors
   duly elected and qualified:                                                     of the Corporation for 
                                                                                   1998; and  
[ ] FOR all nominees except the following 
    (to withhold authority to vote for any                                      4. Upon such other business as may properly come 
    individual nominee, write that nominee's                                       before the Annual Meeting or any adjournments. In
     name below):                                                                  their discretion, the proxies are authorized to
                                                                                   vote upon such other business as may properly 
- ------------------------------------------------------                             come before the Annual Meeting and any 
                                                                                   adjournments thereof.









SIGNATURE(S)____________________________________________________________________________________________________ DATE_______________

NOTE: Please sign exactly as your name appears herein. When shares are held by joint tenants, both should sign. When signing as 
      attorney, executor, administrator, attorney, trustee, or guardian, please give full title as such. If a corporation, please 
      sign in full corporation name by President or other authorized officer. If a partnership, please sign in partnership name by 
      authorized person.
</TABLE>




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