A month after the first shock, the bank is in trouble again.
The quarterly report caused panic and cut the value of its shares in half.
The
financial report of First Republic Bank (NYSE: FCR), one of the American financial
institutions that sparked a global wave of concern about the financial system's
stability in March, has found itself in trouble again.
According
to the financial report for the first quarter of 2023 published this week,
First Republic customers withdrew over $100 billion in deposits from their
accounts, fearing the institution's bankruptcy. As a result, the already
heavily discounted FCR shares fell by another 50% in a single day on Wall
Street.
First Republic Bank's
Revenues, Net Profit, and Deposits Down
The report
published by First Republic shows that revenues in the first three months of
2023 fell 13.4% to $1.2 billion, while net profit was $269 million,
shrinking 32.9%. On the other hand, the value of deposits contracted 35.5% to $104.5 billion.
Diluted
earnings per share amounted to $1.23, dropping 38.5%, while book value per
share grew 10.4% to $76.97.
"With
the closure of several banks in March, we experienced unprecedented deposit
outflows," said Neal Holland, the Chief Financial Officer of First
Republic. "We moved swiftly and leveraged our high-quality loan and
securities portfolios to secure additional liquidity. We are working to
restructure our balance sheet and reduce our expenses and short-term
borrowings."
In response
to the financial report, FRC shares fell 49% on Tuesday, closing the day at
$8.10, deepening the historical lows.
The company
is now considering disposing of assets worth between $50 and even $100 billion
to improve its poor condition.
First Republic Bank
Announces Restructuring Plan
As part of
the asset sale, First Republic is considering offloading long-term mortgage loans
and securities to reduce the gap between liabilities and assets. This was one
of the main factors that led the institution to the verge of bankruptcy in
March after a run on deposits.
Potential
buyers include other large banks that could count on preferred shares or
warrants as an incentive to purchase the troubled unit's assets, Bloomberg
reported.
"With
the stabilization of our deposit base and the strength of our credit quality
and capital position, we continue to take steps to strengthen our
business," said Mike Roffler, the CEO and President of First Republic.
"We remain fully committed to serving our communities, and we are grateful
for the ongoing support of our clients and colleagues."
Additionally,
the institution aims to cut costs, including laying off 20-25% of its employees
in the coming months. Even more
drastic cuts were announced earlier by others of the major investment
banks.
The
financial report of First Republic Bank (NYSE: FCR), one of the American financial
institutions that sparked a global wave of concern about the financial system's
stability in March, has found itself in trouble again.
According
to the financial report for the first quarter of 2023 published this week,
First Republic customers withdrew over $100 billion in deposits from their
accounts, fearing the institution's bankruptcy. As a result, the already
heavily discounted FCR shares fell by another 50% in a single day on Wall
Street.
First Republic Bank's
Revenues, Net Profit, and Deposits Down
The report
published by First Republic shows that revenues in the first three months of
2023 fell 13.4% to $1.2 billion, while net profit was $269 million,
shrinking 32.9%. On the other hand, the value of deposits contracted 35.5% to $104.5 billion.
Diluted
earnings per share amounted to $1.23, dropping 38.5%, while book value per
share grew 10.4% to $76.97.
"With
the closure of several banks in March, we experienced unprecedented deposit
outflows," said Neal Holland, the Chief Financial Officer of First
Republic. "We moved swiftly and leveraged our high-quality loan and
securities portfolios to secure additional liquidity. We are working to
restructure our balance sheet and reduce our expenses and short-term
borrowings."
In response
to the financial report, FRC shares fell 49% on Tuesday, closing the day at
$8.10, deepening the historical lows.
The company
is now considering disposing of assets worth between $50 and even $100 billion
to improve its poor condition.
First Republic Bank
Announces Restructuring Plan
As part of
the asset sale, First Republic is considering offloading long-term mortgage loans
and securities to reduce the gap between liabilities and assets. This was one
of the main factors that led the institution to the verge of bankruptcy in
March after a run on deposits.
Potential
buyers include other large banks that could count on preferred shares or
warrants as an incentive to purchase the troubled unit's assets, Bloomberg
reported.
"With
the stabilization of our deposit base and the strength of our credit quality
and capital position, we continue to take steps to strengthen our
business," said Mike Roffler, the CEO and President of First Republic.
"We remain fully committed to serving our communities, and we are grateful
for the ongoing support of our clients and colleagues."
Additionally,
the institution aims to cut costs, including laying off 20-25% of its employees
in the coming months. Even more
drastic cuts were announced earlier by others of the major investment
banks.
Damian's adventure with financial markets began at the Cracow University of Economics, where he obtained his MA in finance and accounting. Starting from the retail trader perspective, he collaborated with brokerage houses and financial portals in Poland as an independent editor and content manager. His adventure with Finance Magnates began in 2016, where he is working as a business intelligence analyst.
Devexperts Teams Up with nuam Exchange to Boost Equity and Derivatives Trading
Network, Learn, Grow | FMAS:24
Network, Learn, Grow | FMAS:24
Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
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Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
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Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/
👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents
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Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
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Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
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Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
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Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
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Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
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Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
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