The US regional bank First Republic has also gotten into trouble as a result of the turbulence in the financial sector. It now receives billions in support from the largest American financial institutions. Eleven banks – including industry leaders JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley – are helping the institute with uninsured deposits totaling $30 billion (28 billion euros), as they announced today.
According to US media, the relief effort was coordinated by US regulators to calm the situation. The move is intended to provide liquidity to the First Republic, which is active in almost a dozen states, and to underline confidence in the US financial system, according to a Citigroup statement. First Republic is one of a number of regional US money houses that came under pressure after the collapse of the Silicon Valley Bank on the stock market. First Republic was recently downgraded by rating agencies due to liquidity and financing risks.
unrest for a week
The Silicon Valley Bank, which specializes in financing start-ups, was closed on Friday after huge withdrawals of funds from US authorities and placed under state control. This caused great turmoil on the stock market.
On Sunday, the US government and central bank issued a far-reaching deposit guarantee for bank customers. At the same time, the financial authorities closed down Signature Bank in New York – another money house that had suddenly stumbled. In addition, the voluntary resolution of the US crypto bank Silvergate Capital had already sent shock waves through parts of the financial sector. After it looked at times as if the US government’s intervention would calm the situation, the plight of the major Swiss bank Credit Suisse caused new turbulence on the financial market this week.
