First Republic Bank’s stock is plummeting before the opening bell on Tuesday following reports that depositors withdrew more than $100 billion during last month’s financial crisis. Customers withdrew their deposits amid concerns that the bank could be the third to fail after Silicon Valley Bank and Signature Bank. To prevent further loss, a group of large banks deposited $30 billion in uninsured funds. First Republic Bank now plans to restructure its balance sheet, sell assets, and lay off up to a quarter of its workforce, which totaled 7,200 employees at the end of 2022. Citi analyst Arren Cyganovich recommended investors sell shares due to the large level of uncertainty in outcomes and expected losses beyond the next year.
The bank’s shares fell over 21% in premarket trading. While other regional banks are also under pressure, the losses were modest early on in what appears to be a down day for markets.