diff --git a/setup.c b/setup.c
index a9db1f2c23..2748155964 100644
--- a/setup.c
+++ b/setup.c
@@ -2710,8 +2710,7 @@ out:
 	return ret;
 }
 
-static void repository_format_configure(struct repository *repo,
-					struct repository_format *repo_fmt,
+static void repository_format_configure(struct repository_format *repo_fmt,
 					int hash, enum ref_storage_format ref_format)
 {
 	struct default_format_config cfg = {
@@ -2748,7 +2747,6 @@ static void repository_format_configure(struct repository *repo,
 	} else if (cfg.hash != GIT_HASH_UNKNOWN) {
 		repo_fmt->hash_algo = cfg.hash;
 	}
-	repo_set_hash_algo(repo, repo_fmt->hash_algo);
 
 	env = getenv("GIT_DEFAULT_REF_FORMAT");
 	if (repo_fmt->version >= 0 &&
@@ -2786,9 +2784,6 @@ static void repository_format_configure(struct repository *repo,
 
 		free(backend);
 	}
-
-	repo_set_ref_storage_format(repo, repo_fmt->ref_storage_format,
-				    repo_fmt->ref_storage_payload);
 }
 
 int init_db(struct repository *repo,
@@ -2830,10 +2825,10 @@ int init_db(struct repository *repo,
 	 * is an attempt to reinitialize new repository with an old tool.
 	 */
 	check_repository_format_gently(repo_get_git_dir(repo), &repo_fmt, NULL);
+	repository_format_configure(&repo_fmt, hash, ref_storage_format);
 	if (apply_repository_format(repo, &repo_fmt, APPLY_REPOSITORY_FORMAT_HONOR_ENV, &err) < 0)
 		die("%s", err.buf);
 	startup_info->have_repository = 1;
-	repository_format_configure(repo, &repo_fmt, hash, ref_storage_format);
 
 	/*
 	 * Ensure `core.hidedotfiles` is processed. This must happen after we