after a stock market plunge, the fate of the First Republic bank in suspense

after a stock market plunge, the fate of the First Republic bank in suspense

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The action of the First Republic bank plunged again on Wall Street on Monday. Massive monetary support from a group of major US banks was not enough to reassure investors. The title plunged 47.11% on the New York Stock Exchange on Monday March 20.

First Republic is still under pressure on the New York Stock Exchange. The Californian regional bank is affected on Monday by the downgrading of its rating on Sunday by the financial rating agency Standard & Poor’s (S&P).

However, the bank claims to be able to ensure its customers’ withdrawals thanks to its own reserves and the safety plan of 30 billion dollars financed by 11 major American banks. The Minister of the American Economy also intervened. Janet Yellen was reassuring on Sunday about the strength of the US banking system in terms of capitalization and liquidity.

Raise new capital

But another element did not appease investors: the New York Times claimed that First Republic was trying to raise new capital from other financial institutions. The option of its sale is also on the table, according to the daily.

This tends to show that his problem is still not solved. The future of the bank is therefore uncertain. Investors’ eyes are now on the Fed. The US Federal Reserve is expected to decide on Wednesday whether or not to raise its key rate.

First Republic, which was founded in 1985, is based in San Francisco. Its agencies are primarily located in California and in urban areas on the east coast. It was at the end of 2022 the fourteenth American bank by the size of assets.

►Also read : United States: Treasury Secretary tries to reassure about the soundness of the banking system


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