A consortium of 11 major U.S. banks has agreed to invest $30 billion into First Republic Bank – a regional US bank that showed signs of destabilization this week following Silicon Valley Bank (SVB)’s collapse.
The uninsured deposits come from Bank of America, Citigroup, JPMorgan Chase, Wells Fargo, Goldman Sachs, Morgan Stanley, Bank of New York Mellon, PNC Bank, State Street, Truist, and U.S. Bank.
As reported by Yahoo Finance, the former four banks each contributed $5 billion each, with Goldman and Morgan Stanley depositing $2.5 billion each.
“This support from America’s largest banks reflects confidence in First Republic and its ability to continue to provide unwavering exceptional service to its clients and communities,” said First Republic in a press release Thursday.
First Republic was one of many regional banks whose stock crumbled this week after SVB failed on Sunday – despite the Fed’s confirmation that it would fully bail out the latter’s depositors.
While still down 73% from earlier this month, First Republic (FRC) shares are back up 10% on the day following its announcement.
First Republic held a cash position of $34 billion as of yesterday, before which it said bank borrowing from the Federal Reserve “varied from $20 billion to $109 billion at an overnight rate of 4.75%.”
“Insured deposits from close of business on March 8, 2023 to close of business on March 15, 2023 have remained stable,” it continued. “Daily deposit outflows have slowed considerably.”
The bank added that it will be reducing its borrowings, while also suspending dividend payments to stockholders.
SVB and Signature alike faced billions of dollars in withdrawals this weekend before ultimately being seized by the FDIC.
The post Big Banks Help Stabilize First Republic With $30 Billion Cash Injection appeared first on CryptoPotato.