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By Jason Cohen
Daily Caller News Foundation
First Republic Bank’s stock price plunged more than 30% on Wednesday morning, following a nearly 50% drop on Tuesday after a first-quarter earnings report on Monday as the regional bank seeks a rescue to avoid collapse.
The consecutive days of freefall that showed the bank lost $102 billion of its deposits following sector turmoil in March, according to the earnings report. First Republic hired Lazard and JPMorgan Chase to advise the bank, according to the Financial Times; they are relying on the government to pressure CEOs from big banks to come together to save First Republic again, according to CNBC.
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The financial advisors are attempting to persuade them to give additional help by purchasing First Republic’s assets like bonds priced above market value, according to CNBC. It would cause losses of a few billion dollars for the other institutions, but First Republic’s advisor pitch is that its failure would be even more costly as it could lead to about $30 billion in fees from the Federal Deposit Insurance Corporation (FDIC).
11 of America’s largest financial institutions, including JPMorgan Chase, injected $30 billion into First Republic to save it from collapse and prevent contagion from Silicon Valley Bank’s (SVB) and Signature Bank’s collapses in March. The bank experienced significant deposit flight after the failures.
First Republic did not immediately respond to the Daily Caller News Foundation’s request for comment.
This story originally was published by the Daily Caller News Foundation.
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