Customers pulled their money from the San Francisco institution following the March 10 failure of Silicon Valley Bank, an event that triggered panic across the banking system.
said Monday it lost a net total of $72 billion in deposits during the first quarter, an outflow that would have topped $100 billion if not for a rescue from 11 of the nation's largest banks., an event that triggered panic across the banking system and caused depositors to seek the perceived safety of bigger financial institutions.
The bank said Monday that outflows began to stabilize the week of March 27 and deposit activity "has remained stable" through April 21. Its balance as of Friday was $102.7 billion, a drop of 1.7% since the end of the quarter that the bank attributed to seasonal client tax payments. First Republic, like many regional banks, is trying to adapt to a period of higher interest rates as deposit costs rise across the industry while loan margins shrink. Its first-quarter earnings of $269 million were down by 30% from the fourth quarter and 33% from the year earlier period.
The bank on Monday offered its first public account of how the events of March transpired inside the company. As of March 9, the day before regulators seized Silicon Valley Bank, its deposits were $173.5 billion, down just slightly from the year end. On March 10, it began experiencing "unprecedented deposit outflows."
"We moved swiftly and leveraged our high-quality loan and securities portfolios to secure additional liquidity," First Republic Chief Financial Officer Neal Holland in a release. "We are working to restructure our balance sheet and reduce our expenses and short-term borrowings."Since mid March the bank has been exploring multiple options that might restore more stability, including raising capital or a sale.
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