HomeTop U.S. NewsFDIC Set to Take Over First Republic After Rescue Attempts Fail

FDIC Set to Take Over First Republic After Rescue Attempts Fail

First Republic will likely be the latest victim of the U.S. banking crisis. According to Reuters, the bank will be taken over by Federal Deposit Insurance Corporation (FDIC) after recent rescue attempts didn’t have a positive outcome.

Unlike several other mid-sized banks like Signature Bank and Silicon Valley Bank, First Republic managed to avoid collapse at the height of the banking crisis in March. It received assistance from big banks at the time, but this proved insufficient.

In the first-quarter earnings report shared on Monday, First Republic revealed disappointing numbers that included a deposit outflow of $100 billion. The bank’s stock lost 50% of its value in the aftermath and continued to fall as the week went by.

The government and First Republic advisors have discussed a number of potential rescue plans in recent days, including the creation of a “bad bank” and selling assets. However, none of those options seem to be viable, and the bank will enter the FDIC receivership.

“We are engaged in discussions with multiple parties about our strategic options while continuing to serve our clients,” First Republic said in a statement provided to CNBC when reached out for a comment.

First Republic shares closed at $3.51 on Friday, down 43.30% compared to the day prior and 97.11% down year to date. The stock continued its fall in after-hours trading, dropping additional 41.03%

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