First Republic Bank sinks more than 20% after falls in deposits: what options does the bank analyze

The actions of First Republic Bank they sink more than 20% this Tuesday, after falling another 20% at the end of the close on Monday, when announcing that they collapsed by more than 100,000 million dollars in the first quarter and that it was exploring options such as the restructuring of its balance sheet .

The deposit slump eclipsed earnings that beat expectations for the bank, propped up last month by deposits from US banking giants after the bankruptcy of two regional lenders.

First Republic, based in San Franciscoplans to reduce its balance sheet and reduce expenses by cutting executive pay, reducing office space and laying off 20% to 25% of employees in the second quarter, it announced Monday.

The company also intends to increase its insured deposits and reduce Federal Reserve Bank lending.

“We are taking steps to significantly reduce our expenses, in line with our goal of reducing balance sheet size,” Chief Executive Mike Roffler said in a post-earnings conference call. The briefing lasted less than 15 minutes and ended without executives responding to analyst questions.

The refusal to submit to a question-and-answer session was reminiscent of calls during the 2008 financial crisis, said Timothy Coffey, an analyst at Janney Montgomery Scott LLC who had dialed.

First Republic also said it is “looking at strategic options” to help speed progress on strengthening the bank, without elaborating.

The entity is studying all options, according to a person familiar with the matter who spoke on condition of anonymity because the discussions are private. The source said the bank is seeking government help to convene parties that could potentially play a role in First Republic’s booming fortunes, including private equity firms and big lenders.