Shares of First Republic Bank nosedived on Wall Street Thursday following a report that the embattled California bank is considering strategic options, including a possible sale.
Shares were off around 30 percent in early trading, the latest rout in a bruising stretch that has seen it lose around three-quarters of its value in a week.
Advertisements - Click the Speaker Icon for Audio
Founded in 1985, First Republic is the 14th largest US bank by assets, with $212 billion at the end of 2022.
Headquartered in San Francisco, First Republic is also present on the East Coast, including in New York and Florida, as well as in western states such as Washington and Wyoming.
The bank is known for private banking and wealth management. As a result of its clientele, the bank has a large percentage of uninsured deposits that has kept it under scrutiny after the failures of Silicon Valley Bank, Signature and Silvergate.
S&P Global Ratings said 68 percent of the bank’s deposits are from accounts of more than $250,000, the level automatically guaranteed by US regulators.
“We believe the risk of deposit outflows is elevated at First Republic Bank despite the actions of federal banking regulators and the bank actively increasing its borrowing availability to mitigate risk associated with the bank failures over the last week,” S&P said Wednesday as it downgraded the rating on First Republic.
Citing sources close to the matter, Bloomberg reported that First Republic was considering strategic options that include a sale.
On Sunday, First Republic announced that it had obtained additional liquidity from the Federal Reserve and JPMorgan Chase.