The FDIC is racing to find a buyer for First Republic Bank’s collapse

a job

by Catherine Dunleavy

April 29, 2023 | 8:27 p.m

Federal regulators are scrambling to find a buyer for First Republic Bank as shares of the banking company continue to crash, according to a report.

Federal Deposit Insurance Corp. requested From several high-powered banks — including JPMorgan Chase & Co. and PNC Financial Services Group Inc. and US Bancorp and Bank of America Corp. Submit final bids to First Republic Bank by the Sunday after the initial measurement. interest earlier in the week, sources told Bloomberg.

The FDIC reached out to banking companies on Thursday, one day after First Republic Bank shares plunged 30%.

The bank suffered an initial share price drop of 50% on Tuesday after the San Francisco-based lender revealed that customers withdrew $100 billion in deposits — 40% of the company — in the first three months of the year.

This massive collapse prompted First Republic Bank to seek federal aid and put it into receivership.

After deciding the lender’s position had deteriorated beyond the opportunity to seek a bailout through the private sector, the FDIC reportedly reached out to other major public corporations for help.

People familiar with the matter told Bloomberg that the regulator offered each bank a suggested rate and estimated cost for the agency’s deposit insurance fund.

First Republic is looking to sell between $50 billion and $100 billion of its assets, including mortgages and securities.

Since then, the FDIC has reportedly narrowed its options to at least six banks, including Citizens Financial Group Inc.

A deal is expected to be announced Sunday night before the Asian markets open. The regulator is likely to announce that it has taken over First Republic Bank.

If the lender falls into receivership, it will be the third US bank to fail since March.

If none takes over, the FDIC can take over the bank and provide government support for all deposits, a measure it has taken with Silicon Valley Bank and Signature Bank of New York.

Bank of America, JPMorgan, BNC and Citizens Bank declined to comment.

US Bancorp and First Republic did not immediately respond to The Post’s request for comment.

with mail wires