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America’s biggest bank J P Morgan took First Republic Bank with $10.6bn (£8.5bn).
has played down the risk of a spiralling banking crisis
Major customers pulled $100 billion worth of deposits out of the bank in March 2023.
This fueled fresh concerns about the health of the US banking system as a whole.
The bank will fire 20 to 25% of employees as part of an effort to shrink its balance sheet and stay afloat.
Eventual government receivership for the ailing bank after it exhausts private sector solutions.
First republic bank is proposing other Big Banks purchase bonds from First Republic at above-market rates for a loss of a few billion dollars.
Last month (March 2023) Silicon Valley Bank and Signature collapsed due to lack of funds in the bank.
The US government seized both banks.
Eventually First Citizens Bank agreed to buy most of Silicon Valley Bank
First Republic Bank receive a $30 billion lifeline from a group of America’s largest banks.
The major banks include JPMorgan Chase, Bank of America, Wells Fargo, Citigroup and Truist.
As a last effort, the bank is asking investors to buy bonds for more than they are worth.
That will save the bank and other parties will step up to help the bank recapitalize itself.
First Republic Bank is a financial company that operates through Commercial Banking and Wealth Management segments.
First Republic Bank ranks 297th in the Financial System Benchmark
Established in 1985, the First Republic Bank (NYSE: FRC) is located in San Francisco, California, USA.
Data as of March 31, 2023 $ in Billions
Total wealth management assets were $289.5 billion on March 31, 2023, up 6.7% compared to the prior quarter
This included investment management assets of $118.9 bln, brokerage assets and money market mutual funds of $149.7 bin, and trust and custody assets of $20.9 bin.
First Republic Bank Stock (FRC) is down by 95% from $120 on 1st March 2023 to $5.69 on 25th April 2023.
Within a week the stock was down over 50% from $12 on 21st March to $5.69 on 25th March.
The issue at First Republic Bank reopened the woes of the crisis again.
The trouble around the First Republic Bank is clearly saying that the banking crisis is not over yet.
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