New York, Mar 16 (EFE).- A group of US financial institutions rescued First Republic Bank on Thursday with 30,000 million, as announced in a joint statement.
“Bank of America, Citigroup, JPMorgan Chase and Wells Fargo today announced that they will each make a $5 billion uninsured deposit to First Republic Bank. Goldman Sachs and Morgan Stanley will each make an uninsured deposit of $2.5 billion, and BNY Mellon, PNC Bank, State Street, Truist and US Bank will each make an uninsured deposit of $1 billion,” according to the document.
Following this announcement, First Republic shares were up 11.42% as of 15:42 local time, 19:42 GMT, a stark contrast to a nearly 30% drop earlier this morning.
First Republic had the third highest rate of uninsured deposits among US banks, behind Silicon Valley Bank (SVB) and Signature Bank, according to a note by Raymond James.
San Francisco-based First Republic was downgraded to junk on Wednesday by both Fitch Ratings and S&P Global.
With this movement, First Republic is prevented from following the path of Silicon Valley Bank and Signature Bank, entities closed by the authorities on Friday and Sunday, respectively, in a movement that unleashed a wave of panic that later spread to Europe.
