First Republic slides before the bell after depositor exodus

FILE – A television screen displaying financial news, including the stock price of First Republic Bank, is seen inside one of the bank’s branches in New York’s Financial District, on March 16, 2023. Customers of the bank pulled more than $100 billion in deposits out of the bank during the March crisis, as fears swirled that it could be the third bank to fail after the collapse of Silicon Valley Bank and Signature Bank. (AP Photo/Mary Altaffer, File) (ASSOCIATED PRESS)

First Republic Bank’s stock is plunging before the opening bell Tuesday after it said depositors withdrew more than $100 billion during last month’s crisis, with fears swirling that it could be the third bank to fail after the collapse of Silicon Valley Bank and Signature Bank.

The San Francisco bank said Monday that it was only able to staunch the bleeding after a group of large banks stepped in to save it by depositing $30 billion in uninsured deposits.

It said it now plans to sell off assets and restructure its balance sheet, and lay off as much as a quarter of its workforce, which totaled about 7,200 employees at the end of 2022.

“With still a large level of uncertainty in outcomes and expected losses beyond the next year, we recommend investors sell shares as the outlook appears largely unclear,” Citi analyst Arren Cyganovich said in a note to clients.

Shares tumbled more than 21% in premarket trading.

Other regional banks were under pressure in what looks like a down day for markets, but the losses were modest early.

Source: https://finance.yahoo.com/news/first-republic-slides-bell-depositor-123632431.html