March16(Agencies) – Despite an unprecedented show of support, First Republic Bank’s (FRC.N) shares fell 17percent in extended trading Thursday, in the bank from nearly a dozen of the world’s largest financial institutions.
An unusual rescue said to be orchestrated by JPMorgan Chase & Co (JPM.N) Chief Executive Jamie Dimon earlier this week along with Treasury Secretary Janet Yellen and Federal Reserve Chair Jerome Powell, 11 Wall Street firms said they were depositing $30 billion into First Republic.
However, investors’ relief was short-lived as The bank’s shares, which had closed 10% higher after a volatile day that saw trading halted 17 times, slumped in after-market trading. Volume hit 15.6 million shares in the post-market session.
The company also told of borrowed up to $109 billion from the Fed between March 10 and March 15, and an additional $10 billion from the Federal Home Loan Bank on March 9.
The reversal in First Republic’s shares after the rescue deal from the biggest U.S. banks underscores the extent of jitters in global markets, set in motion when two regional banks failed. Separate attempts earlier this week by U.S. and European regulators to calm investors through emergency measures to shore up confidence in the banking sector have not stuck.
Jason Ware, chief investment officer for Albion Financial Group, said the Dimon-led banking sector intervention on Thursday was a “shot in the arm of the system” but likely more was needed. “It’s not big enough,” Ware said.
Ware added that it also crystallized in investors’ minds that there were deeper problems at First Republic.
Pakistan Rupee Exchange Rate