2023-04-29 01:34:00
It is known that the US financial authorities are imminent to intervene in the US First Republic Bank, which has been engulfed in crisis rumors.
Archyde.com reported on the 28th (local time), citing sources, that the Federal Deposit Insurance Corporation is preparing to take control of First Republic Bank.
The bank’s recent situation has worsened and the financial authorities have judged that there is no longer time to wait for relief through the private sector.
Earlier, CNBC also reported that the Federal Deposit Insurance Corporation is likely to take over as trustee for First Republic’s bankruptcy.
If this bank enters the management system of the financial authorities, it is expected to follow the steps of Silicon Valley Bank (SVB) and go through the process of forced sale.
Last month, when SVB was on the brink of bankruptcy due to a sudden bank run (large-scale cash withdrawal), the Federal Deposit Insurance Corporation was appointed as bankruptcy trustee, and the sale proceeded followingwards.
If a bank wants to dramatically acquire First Republic Bank, the possibility of government intervention can be avoided, but if a buyer does not appear, the Federal Deposit Insurance Corporation will take over First Republic’s deposits and assets and manage them directly.
The stock price of First Republic Bank plummeted on the news that the possibility of government intervention was high. On the 24th, following the results were released that customer deposits plunged 40% in the first quarter, the bank’s stock price fell more than 60% in two days. The previous day, it rebounded by 8.8% and seemed to take a breather from rumors of a crisis, but it turned into a sharp decline in one day.
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