First Republic will receive $30 billion from other banks as part of the rescue program
The largest US banks are close to concluding an agreement with the US government to rescue the First Republic. According to Bloomberg, citing its own sources, banks are ready to provide the First Republic with $30 billion in the form of their own deposits. The deal could be officially announced as early as Friday.
The largest US banks, including JPMorgan, Bank of America and Citigroup, will make $5 billion in deposits under the rescue plan, while smaller banks will put in smaller amounts. Details of the First Republic bailout plan are still being worked out, but the draft agreement has already been circulated to financial institutions and federal agencies, the sources say.
First Republic, which specializes in mortgage lending, was among the US banks experiencing serious financial problems. Rumors about the problems of the bank appeared last Friday, March 10, along with the news about bankruptcy Silicon Valley Bank. Sunday New York Regulator closed due to systemic risks, another bank is Signature Bank, which specialized in lending to the cryptocurrency industry. And the next in this chain could be First Republic, whose shares collapsed on Monday by 70%. The bank's quotes partially recovered only after it confirmed on Monday that it received adequate support from the Fed and JPMorgan Chase. At the same time, First Republic, according to Bloomberg, is considering selling its business as a saving measure.