First Republic Bank has received fresh funding from the Federal Reserve and JPMorgan Chase & Co amid fears that it could be in the same kind of trouble that led to the collapse of Silicon Valley Bank (SVB).
According to the Wall Street Journal, First Republic now has $70 billion in unused liquidity while still being able to tap into Fed’s lending program.
“First Republic’s capital and liquidity positions are very strong, and its capital remains well above the regulatory threshold for well-capitalized banks,” First Republic said in a statement released on Monday.
The last week saw two of the largest bank failures in U.S. history. Silicon Valley Bank was first to fold on Friday following a massive bank run, while crypto-friendly Signature Bank followed the suit later in the week.
Since the First Republic is considered to have a similar profile to the previous two, many depositors started fearing for their money. Some bigger clients have started diversifying their banking options, causing even more concerns.
The funding from the Fed and JPMorgan was expected to alleviate some concerns, but that isn’t proving to be the case yet. First Republic’s shares plummeted 65 percent on Monday, and it wouldn’t be a surprise if the dip continues in the following days.