Business
First Republic Bank Shares Tank Not Long After SVB Crash
Concerns about the health of American banks have not been dispelled by the government’s guarantee of deposits at Silicon Valley Bank (SVB), as Monday saw a strong sell-off in the shares of many bank firms.
Following sharp drops, trading in the shares of numerous banks was suspended on Monday morning.
First Republic shares dropped by a record-breaking 67 percent. According to agreements with the Federal Reserve and J.P. Morgan, the bank disclosed late Sunday that it has more than $70 billion in unused liquidity. Chase, Morgan.
Investors are concerned that customers of particular banks may continue to withdraw money and bring down banks despite government efforts to support deposits above the customary $250,000 limit. According to Bloomberg news, 68 percent of First Republic’s deposits are beyond that limit.
Several analysts believe that if a bank’s future seems bleak, huge corporate deposits may be more vulnerable to flight.
On Monday morning, the KBW Bank Index was down 13 percent. Even some of the biggest banks’ shares were declining. Shares of Bank of America decreased by 4.6%. Wells Fargo’s stock dropped 6.4%. Citigroup’s stock fell by 5.9 percent.
Shares of numerous smaller banks have fallen. PacWest stock has decreased by more than 50 percent. Western Alliance Bancorp’s stock dropped by about 85 percent.
J.P. Morgan Chase shares went down by under one percent.
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