- Rating agencies S&P Global and Fitch downgraded First Republic’s credit rating to junk status.
- The bank is now considering various options, including a sale and increased liquidity, Bloomberg reported.
- It could attract interest from major lenders if it comes up for sale.
First Republic Bank is considering various options, including a sale, Bloomberg reported Wednesday, citing people with knowledge of the matter.
The bank is expected to attract interest from major lenders if it goes up for sale, according to Bloomberg. The San Francisco-based lender is also looking at opportunities to increase liquidity, according to the news outlet.
Credit rating agencies S&P Global and Fitch had cut First Republic’s credit rating to junk status earlier Wednesday over concerns that depositors could pull funds from the lender.
First Republic has been providing customers with its liquidity since the implosion of Silicon Valley Bank — which in turn sparked concerns about the financial health of regional banks.
On Sunday, First Republic said it secured $70 billion in additional financing from the Federal Reserve and JPMorgan Chase after its stock price plunged amid the Silicon Valley Bank implosion.
“We believe the risk of deposit outflows is elevated at First Republic Bank despite the moves by federal banking regulators and the bank actively increasing its credit availability to mitigate the risk associated with the bank failures of the past week,” S&P Global Ratings analysts wrote Nicholas Wetzel and Rian Pressman.
First Republic’s share price closed Wednesday 21.4% lower at $31.16 apiece. They are down 74% so far this year.
First Republic Bank did not immediately respond to Insider’s request for comment sent outside regular business hours.
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