The lending crisis that developed at First Republic Bank has raised concerns among investors about a potential banking crisis.
Several large banks provided a $30 billion lifeline to the troubled regional lender, but this was unable to calm the nerves of investors, causing a widespread bank selloff.
The latest bank to fall victim to the crisis is First Republic Bank, with their shares dropping by as much as 21% in early trading after the bank suspended its dividend payout.
The recent selloff of several stocks in the banking sector, including the collapse of SVB Financial and Signature Bank, has caused fears about a potential banking crisis.
Large banks including JPMorgan Chase and Morgan Stanley responded to the concerns by providing a $30 billion lifeline to First Republic Bank.
However, investor fears remain despite the optimism shown on Wall Street's main indexes that managed to notch gains in the previous session.
First Republic Bank was hit hard by the crisis, with shares plummeting by 21% in early trading after the dividend payout was suspended.
While Reuters reports that the bank had been thrown a lifeline, the NY Post reports a much bleaker situation, characterising the situation as a crisis with investors remaining wary, and a widespread bank selloff causing plunging shares.
The NY Post informs us that several financial institutions have faced pressures from surging interest rates, while Reuters earlier noted that the fate of First Republic Bank increased fears of a potential banking crisis.
Nonetheless, both news outlets agree that investors remain cautious given the escalating situation.