First Republic Bank on the verge of collapse; expected to be seized by the US government
San Francisco-based First Republic Bank is expected to be seized by the US government, according to a report by Fox Business’ Charles Gasparino, citing sources from the bank. The sources told Fox that they believe that the distressed bank will eventually end up in government receivership.
This outcome is expected after the bank exhausts all private sector options, including asset sales and finding a buyer, both of which seem challenging to accomplish. First Republic Bank has lost at least $102 billion in customer deposits since March, as worried depositors and investors withdrew their deposits.
The news comes just a month following the collapse of Silicon Valley Bank, another San Francisco-based bank that provides loans and other financial services to startups and tech companies, and venture capital firms across the United States and around the world.
Per the announcement made by First Republic Bank on Monday, the bank’s deposits decreased by more than 40 percent, which amounts to approximately $72 billion, in the first quarter of this year. This decline resulted in a nearly 50 percent drop in the bank’s shares, which was observed as of the end of Tuesday.
First Republic Bank is a private bank that offers services such as personal banking, business banking, and wealth management. It was started in San Francisco, California, in 1985, and has since expanded to service clients throughout the United States.
Personal banking services provided by the bank include checking and savings accounts, mortgages, home equity lines of credit, personal loans, and credit cards. They also provide specialist services for doctors, lawyers, and other professionals. Business checking and savings accounts, lines of credit, term loans, commercial real estate finance, and equipment financing are all available from First Republic Bank.