Major banks announce $30 billion rescue of First Republic Bank

 March 17, 2023

A group of major banks announced a $30 billion rescue of First Republic Bank on Thursday.

The plan includes uninsured deposits from $1 billion to $5 billion from nearly a dozen banks, according to a statement from the institutions.

The statement

"Bank of America, Citigroup, JPMorgan Chase and Wells Fargo announced today they are each making a $5 billion uninsured deposit into First Republic Bank. Goldman Sachs and Morgan Stanley are each making an uninsured deposit of $2.5 billion, and BNY Mellon, PNC Bank, State Street, Truist and U.S. Bank are each making an uninsured deposit of $1 billion," the banks announced.

"The actions of America’s largest banks reflect their confidence in the country’s banking system. Together, we are deploying our financial strength and liquidity into the larger system, where it is needed the most. Smaller- and medium-sized banks support their local customers and businesses, create millions of jobs and help uplift communities. America’s larger banks stand united with all banks to support our economy and all of those around us," the joint statement continued.

The group of banks

The full list of banks includes Bank of America, Citigroup, JPMorgan Chase, Wells Fargo, Goldman Sachs, Morgan Stanley, BNY Mellon, PNC Bank, State Street, Truist Bank, and U.S. Bank.

"The move is seen as an 'extraordinary effort to stave off financial contagion,' as The New York Times reported. First Republic stock is down 11% in premarket trades," MarketWatch reported on Friday.

The news follows concerns after Silicon Valley Bank collapsed last week in a move that sent panic to regional banks.

Swiss bank Credit Suisse also saw its shares collapse after concerns over its largest lender the Saudi National Bank saying it would not give the institution any more assistance.

The Swiss National Bank announced more than $50 million in financial assistance on Thursday to intervene in the concerning international banking issue.

The banking collapse concerns are among the worst since 2008 under the Obama administration when multiple bank failures led to new big government policies intended to stop future collapses.

The Biden administration has sought to assure Americans that its banks are safe but recent actions indicate the promises may not be as solid as suggested.

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