The collapse of Silicon Valley Bank (SVB) earlier this month sent a veritable shockwave throughout the financial industry.

SVB isn't the only institution to show signs of distress, though, as the Washington Examiner reported on Thursday that First Republic Bank "is hemorrhaging value."

Biden speech did not instill confidence

According to the newspaper, First Republic Bank was relegated to "junk status" this week following a report by the credit rating agency Standard and Poors.

Standard and Poors determined that First Republic Bank faces an elevated risk of a run by depositors, something which efforts by the Biden administration to try and instill public confidence in the banking sector have not alleviated.

As a result, the San Francisco-based bank saw its long-term issuer credit rating fall from A- to BB+, a fact that was commented on by Bloomberg TV reporter Kailey Leinz.

First Republic just got cut to junk by S&P... which said it thinks outflow risk remains elevated *despite* the actions of federal banking regulators and the bank actively increasing its borrowing availability.$FRC -23% in premarket

— Kailey Leinz (@kaileyleinz) March 15, 2023

First Republic Bank stock has plummeted

Leinz went on to quote Standard and Poors as saying, "We believe that First Republic’s deposit base is more concentrated than most large U.S. regional banks, which presents heightened funding risks in the current environment."

Shares in First Republic Bank closed at $34.27 on Thursday and fell by another $5.82 in after-hours trading. The stock was worth almost $129 just one month ago.

The Examiner noted that First Republic Bank is far from being the only financial outfit feeling pressure, as Switzerland-based megabank Credit Suisse saw a sharp decline in its stock as well.

On Tuesday, shares in Credit Suisse declined from $2.49 all the way down to $1.76 before making a modest recovery. The stock closed at $2.16 and gained another three cents after the bell.

Some observers say geopolitics may be at work

That turbulence came after the chairman of Saudi National Bank announced that his company would not be increasing its stake in Credit Suisse, citing regulatory concerns.

However, some observers like New York Times bestselling author Jim Rickards believe that there may be geopolitical factors at play in the decision.

Credit Suisse was highly aggressive in freezing Russian assets and applying sanctions. Then China aligned with Russia. China is Saudi Arabia's biggest customer. Then Saudi Arabia refused to bail-out Credit Suisse. Now CS is de facto nationalized. See how it all works? pic.twitter.com/jYxzxxfE2m

— Jim Rickards (@JamesGRickards) March 16, 2023

For his part, Credit Suisse chairman Axel Lehmann sounded an optimistic note, with the Examiner quoting him as saying, "We have strong capital ratios, a strong balance sheet."