First Republic Bank’s stock continued to decline on Wednesday, with a total loss of 60% just this week due to concerns about the bank’s financial stability following the collapse of two other banks.
On Tuesday, the bank reported that over $100 billion had been withdrawn by depositors after the collapse of Silicon Valley Bank and Signature Bank, causing the shares to plummet even more with a decrease of almost 30%. Trading was suspended multiple times due to high volatility.
Large banks were only able to make a deposit of $30 billion to save it from sinking. First Republic Bank plans to sell off unprofitable assets, lay off large amounts of employees, and borrow funds from federal programs to maintain its balance sheet.
With this added expense, net income is expected to decrease. A Citi analyst downgraded the bank, stating uncertainty about the bank’s future outcomes and expected losses.
First Republic’s stock closed at $5.68 on Wednesday, a significant decrease from last year’s price of about $170. Whereas, PacWest Bancorp’s stock rose more than 7% after announcing that its total deposits had increased.