6.4 C
Monday, December 11, 2023

First Republic tumbles at opening bell in US after depositors flee

Must read

First Republic Bank’s stock has plunged at the opening bell in the US after it said depositors withdrew more than 100 billion dollars (about £80.7 billion) during last month’s crisis.

It has sparked fears it could be the third bank to fail after the collapse of Silicon Valley Bank and Signature Bank.

The San Francisco bank said late on Monday it was only able to staunch the bleeding after a group of large banks stepped in to save it by depositing 30 billion dollars (£24.2 billion) in uninsured deposits.

It said it now plans to sell off assets and restructure its balance sheet and lay off as much as a quarter of its workforce, which totalled about 7,200 employees at the end of 2022.

“With still a large level of uncertainty in outcomes and expected losses beyond the next year, we recommend investors sell shares as the outlook appears largely unclear,” Citi analyst Arren Cyganovich said in a note to clients.

Shares tumbled more than 28% when markets opened in the US.

Other regional banks were under pressure in what looks like a down day for markets, but the losses were modest early on.

- Advertisement -

More articles

- Advertisement -

Latest article