First Republic Bank stock plummeted to a new record low on Friday, following reports that it is likely to be forced into FDIC receivership. Sources close to the matter revealed that the bank is “engaged in discussions with multiple parties about our strategic options while continuing to serve our clients.” The bank has suffered heavily in recent weeks, with deposits falling by $72 billion during the quarter to $104.5 billion as of March 31. The bank is reportedly trying to sell $50 billion to $100 billion in long-term assets to shore up its balance sheet and avoid being seized by the FDIC. U.S. regulators are reportedly seeking a private rescue before taking any further action. Other bank stocks were unfazed by the news.
Meanwhile, Federal Reserve Vice Chair for Supervision Michael Barr released a review of failed Silicon Valley Bank, citing “mismanagement by the bank” as the main cause of its failure.
