First Republic bank downgraded to junk by S&P and Fitch considers sale: Bloomberg

  • Rating agencies S&P Global and Fitch downgraded First Republic’s credit rating to junk status.
  • The bank is currently considering various options, including a sale and liquidity boost, according to Bloomberg.
  • If it goes on sale, it could attract interest from major lenders.

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 on sale, according to Bloomberg. According to the news outlet, the San Francisco-based lender is also seeking liquidity options.

Earlier Wednesday, ratings agencies S&P Global and Fitch downgraded First Republic’s credit rating to junk amid fears that depositors could withdraw funds from the lender.

First Republic is reassuring clients of its liquidity following the collapse of Silicon Valley Bank, which in turn raised concerns about the financial health of regional banks.

On Sunday, First Republic said it was receiving additional $70 billion in funding from the Federal Reserve and JPMorgan Chase after its share price plummeted amid the collapse of Silicon Valley Bank.

“We see First Republic Bank’s risk of deposit outflows elevated despite the actions of federal banking regulators and the bank actively increasing credit availability to mitigate the risk associated with the bank’s failure last week,” Nicholas Wetzel, an analyst with S&P Global Ratings, wrote in a note. and Ryan Pressman.

First Republic’s share price fell 21.4% to $31.16 a share on Wednesday. This year they are down 74%.

First Republic Bank did not immediately respond to an Insider request for comment, sent after business hours.

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