First Republic Bank Secures $30 Billion Investment from 11 US Banks

Moscow, March 17 – American First Republic Bank, whose shares fell 36% Thursday, has received $30 billion in deposits from 11 major US banks, following a press release from the bank.

First Republic Bank, a leading private bank and asset management company, announced today that it received $30 billion in uninsured deposits on March 16, 2023 from the bank. of America, Citigroup, JPMorgan Chase, Wells Fargo, Goldman Sachs, Morgan Stanley, Bank of New York Mellon, PNC Bank, State Street, Truist and US Bank.

As of March 15, the bank’s cash position was about $34 billion, not counting $30 billion in uninsured deposits from 11 banks with an original maturity of 120 days at market rates.

From March 10-15, bank loans from the US Federal Reserve System (FRS) ranged from $20 billion to $109 billion at an overnight rate of 4.75%. Since the close on March 9, First Republic Bank has also increased short-term borrowings from the US Federal Reserve for Home Loans by $10 billion, at a rate of 5.09%.

California regulators shut down Silicon Valley Bank (SVB) on March 10, the biggest bank failure in the US since the 2008 financial crisis. The collapse of the SVB was found to be linked to an increase in the Federal Reserve’s key interest rate, which sent down the value of assets on the balance sheets of many financial institutions. Additionally, on March 8, it was announced that crypto-focused Silvergate Bank would be shutting down, and on March 12, a similar Signature Bank in New York was announced.

The New York Times reported that the failure of SVB raised concerns that other US banks could also run into trouble. Against this background, there was a “dumping” of shares of similar SVB-type banks, such as First Republic, Signature Bank and Western Alliance, into the market. Many of these financial institutions cater to first-time clients and have investment portfolios similar to those of SVB.