NY.- First Republic Bank shares plunged 50 percent on Tuesday, a day after a troubling earnings report and a conference call with analysts in which bank executives refused to answer questions.
The speed of the decline led to a series of volatility-induced trades on the New York Stock Exchange.
On Monday, after the regular share sale closed, First Republic released results that showed how perilous the bank’s future has been since mid-March after the fall of Silicon Valley Bank and Signature Bank.
First Republic said its clients withdrew $102 billion from their accounts in the first quarter — well over half the $176 billion it held at the end of last year.
The bank received temporary $30 billion in aid last month from the country’s largest banks to help it improve its operation.
Those banks could withdraw their deposits as early as July.
In the first quarter, First Republic also borrowed $92 billion, mostly from the Federal Reserve and government-backed lending groups, essentially replacing its deposits with credit.
First Republic is considered the most vulnerable regional bank after the March banking crisis.
What happens to it may affect investor confidence in other regional banks and in the financial system more broadly.
Bank executives did little to build confidence during their conference call, offering 12 minutes of prepared remarks.
The bank also announced Monday that it would cut a quarter of its employees and reduce executive compensation by an unspecified amount.
