U.S. regional bank shares fall to 2020 lows – Kommersant
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The index of shares of regional banks fell by more than 5% on the basis of trading on May 2 after the collapse of First Republic Bank. The newspaper reported The Wall Street Journal (WSJ) with reference to exchange data.
Fall leaders among banks:
- PacWest (Los Angeles) – according to the results of trading fell by 27.78%,
- Metropolitan Bank (New York) – by 20.45%,
- Western Alliance (Phoenix, Arizona) – by 15.2%,
- Truist (Atlanta, Georgia) – by 7.68%,
- US Bank (Minneapolis, Minnesota) – by 7.01%.
Shares of large banks also fell as a result of trading. Wells Fargo shares fell 4%, Bank of America – 3%, JPMorgan – almost 2%.
The WSJ notes that stocks of PacWest and Western Alliance, which cater to tech startups, have been down markedly since early March. According to the results of the quarter of 2023, deposits in both banks showed a double-digit decrease, but at the beginning of the second they began to stabilize. PacWest reported that they were going to explore the possibility of selling strategic assets to increase liquidity.
May 1 Federal Deposit Insurance Corporation (FDIC) announcedthat the troubled First Republic Bank is closed. The bank came under external management of the FDIC. According to the decision of the regulator, it will be sold to JPMorgan Chase. As of April 13, 2023, First Republic Bank’s total assets were approximately $229.1 billion and total deposits were $103.9 billion.
First Republic Bank is the third American bank to collapse in the past two months. In March, the FDIC closed Signature Bank, and Silicon Valley Bank went bankrupt the same week. First Republic Bank also faced bankruptcy in March, but received support in the amount of $ 30 billion from the Fed and the six largest US banks.
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