![]() ![]() It’s a self-fulfilling prophecy that can sink even the strongest of lenders. That risks forcing banks to raise capital to meet these requests, which could spook depositors, and so on. Even if these regional banks are 100% solvent, their slumping share prices are causing nervous bank customers to withdraw cash anyways. That’s because we’re seeing a crisis of confidence. However, today’s banking crisis runs deeper than pure numbers suggest. ![]() From an accounting standpoint, First Republic’s key rivals seem like they should muddle through. And Western Alliance Bancorp (NYSE: WAL) announced on May 3 that deposits had risen $1.2 billion since March 31. PacWest Bancorp (NASDAQ: PACW) was trading at roughly 0.3X tangible book value before Friday’s surge. First Republic rivals are now trading at value levels never before seen. This NYSE suspension quashed any hope of redemption and sent shares of other regional banks tumbling.Īt first glance, value investors might sense an opportunity. The stock had been hovering at $3.50 before the halt on the possibility of a white-knight takeover or a potential government bailout. On Tuesday, the New York Stock Exchange surprised markets by immediately suspending all trading in First Republic Bank shares. To get news like this delivered straight to your inbox, click here. This article is an excerpt from the InvestorPlace Digest newsletter. ![]()
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