America’s biggest banks are close to agreeing upon a plan, orchestrated by the US government, to stabilise the battered California lender.
| Large US banks injected $US30 billion in deposits into First Republic Bank on Thursday , swooping in to rescue the lender caught up in a widening crisis triggered by the collapse of two other mid-size US lenders over the past week.
Some of the biggest US banking names including JPMorgan Chase, Citigroup, Bank of America, Wells Fargo, Goldman Sachs and Morgan Stanley were involved in the rescue, according to a statement from the banks.The deal was put together by power brokers including US Treasury Secretary Janet Yellen, Federal Reserve chairman Jerome Powell and JPMorgan Chase CEO Jamie Dimon, who discussed the package on Tuesday, according to a source familiar with the situation.
News of the rescue also helped boost Wall Street indexes, with JP Morgan, Morgan Stanley and Bank of America all up more than 1 per cent, while the lwbenchmark SSmaller banks also rebounded from the recent sell-off, with Fifth Third Bancorp, PNC Financial Services Group and KeyCorp each gaining more than 4 per cent.
The US Federal Reserve is expected to follow the ECB move at its next meeting with a quarter-point interest-rate hike that just days ago looked derailed by turmoil in the banking sector. Dr Yellen said the US banking system remains sound thanks to “decisive and forceful” actions following the collapse of Silicon Valley Bank.
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