Recently, news broke that the struggling First Republic Bank may need to find additional capital, despite receiving a $30 billion (£24 billion) rescue last week, shares of the San Francisco-based bank fell more than 46% on Monday.
The regional bank's credit rating was further reduced by S&P Global into junk status as the banking crisis continued to worsen and entered a new week. The bank, which serves rich clientele, was likely under "high liquidity stress with substantial outflows," the agency stated.
Bloomberg reported on Monday night that US officials are looking into ways to temporarily increase the protection provided to banking clients by the Federal Deposit Insurance Corp (FDIC) to include all deposits, going above the current $250,000 ceiling.
The CEO of JP Morgan, Jamie Dimon, is reportedly leading efforts to extend further support to the First Republic.
The financial infusion, according to First Republic’s executive chairman Jim Herbert and CEO Mike Roffler, “is a vote of confidence for First Republic and the entire US banking system” according to a regulatory filing.
Yet, in anticipation of a bank run, First Republic’s shares have lost 80% of their value during the last 10 days.
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