First Republic shares fall despite deposit infusion, dragging down other regional banks

Date:

[ad_1]

People are seen inside the First Republic Bank branch in Midtown Manhattan in New York City, New York, U.S., March 13, 2023. REUTERS/Mike Segar

Mike Segar | Reuters

Shares of First Republic were under pressure Friday despite the beaten-down regional bank receiving aid from other financial institutions.

As of 11:12 a.m. ET, the stock was down about 24% and was the worst performer in the SPDR S&P Regional Banking ETF (KRE) — which dropped 5%. PacWest and Western Alliance also lost more than 13% each, while KeyCorp slid 8%.

Those losses come even after 11 other banks pledged to deposit $30 billion in First Republic as a vote of confidence in the company.

“This action by America’s largest banks reflects their confidence in First Republic and in banks of all sizes, and it demonstrates their overall commitment to helping banks serve their customers and communities,” the group, which includes Goldman Sachs, Morgan Stanley and Citigroup, said in a statement.

Stock Chart IconStock chart icon
hide content

First Republic Bank continued to crater on Friday.

To be sure, there were concerns that the infusion may not be enough to shore up First Republic going forward.

Atlantic Equities downgraded First Republic to neutral, noting the bank may need an additional $5 billion in capital. 

“Management is exploring different strategic options which may include a full sale or divestments of parts of the loan portfolio. The limited information provided implies that the balance sheet has increased substantially, which may well necessitate a capital raise,” analyst John Heagerty wrote.

See also  Russia’s Economy Is Starting to Come Undone

Meanwhile, Wedbush analysts put a $5 price target on First Republic, saying that a takeover could wipe out most of its equity value.

“A distressed M&A sale could result in minimal, if any, residual value to common equity holders owing to FRC’s significant negative tangible book value after taking into account fair value marks on its loans and securities.”

— CNBC’s Michael Bloom contributed to this report.

[ad_2]

Source link

Popular Posts

More like this
Related

Boost Your Investment Portfolio with DSCR Rental Loans: Here’s How

In the competitive world of real estate investing, finding...

Is a Business Owners Policy Right for Your Business? Here’s What You Need to Know

Running a business comes with a host of responsibilities,...

How to Choose the Best Websites for Your Guest Posting Campaign

One of the main challenges of guest posting is...

How many days do you need to perform Umrah?

If you are performing Umrah for the first time...
https://blog-dosen.umkendari.ac.id/upload/blogs/trik-curang-di-permainan-mahjong-ways2-langsung-dari-mantan-admin.htmlhttps://blog-dosen.umkendari.ac.id/upload/blogs/seorang-marselino-berhasil-menang-ratusan-juta-di-game-mahjong-wins3-scatter-hitam.htmlhttps://blog-dosen.umkendari.ac.id/upload/blogs/pola-ampuh-menangkan-kakek-zeus-dengan-modal-receh.htmlhttps://blog-dosen.umkendari.ac.id/upload/blogs/trending-pola-jitu-gampang-menang-game-online-mahjong-ways.htmlhttps://blog-dosen.umkendari.ac.id/upload/blogs/strategi-luar-dan-dalam-pecah-di-game-online-starlight-princess.html