The First Republic Bank (NYSE: FRC) stock price rallied 26.2%, hoping the Federal Reserve may consider lending it a helping hand by expanding its emergency funding program. The Fed could expand its Bank Term Funding Program (BTFP), created earlier this March to prop up Silicon Valley Bank following its collapse.
YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY.
In other news, the bank is still shopping for a buyer, with speculation indicating that JP Morgan could be interested in acquiring it. The regional bank got into trouble following the collapse of Silicon Valley and Signature Banks as its wealthy customer withdrew their deposits and banked them at the larger banks.
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YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY
First Republic’s business strategy of catering to wealthy clients was the source of its undoing, given that it serves fewer customers with deposits running into the millions. Most of the bank's deposits (about 68%) were uninsured, leaving it pretty exposed once its customers started pulling their deposits.
The current bank run shows no signs of stopping despite First Republic receiving a liquidity injection of $70 billion, with $30 billion coming from the largest US banks. The optimism surrounding the regional bank comes from the positive sentiment, with investors thinking the worst may be over.
Over 12.22 million First Republic (FRC) shares had changed hands at writing as retail investor interest in the bank soared. Still, all is not over for the bank since the Fed has yet to announce additional support for it, given that it was dealing with the more pressing issues surrounding Silicon Valley Bank.
On Sunday, news emerged that First Citizens Bank & Trust Company of Raleigh, North Carolina, entered a purchase agreement for all deposits and loans of Silicon Valley Bridge Bank, National Association.
An FDIC statement said: “The 17 former branches of Silicon Valley Bridge Bank, National Association, will open as First–Citizens Bank & Trust Company on Monday, March 27, 2023.”
The statement continued that Silicon Valley Bridge Bank should continue using their current branch until they receive notice from First–Citizens Bank & Trust Company that systems conversions have been completed.
*This is not investment advice.
First Republic Bank (FRC) stock price.
The First Republic Bank stock price rallied 26.21% to trade at $15.60, rising from Friday’s closing price of $12.36.
YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY.