Another US bank in danger, $30 billion to rescue

A group of major U.S. banks has announced a $30 billion bailout of regional small bank First Republic.

This step was announced by the group of big banks in the US authorities’ efforts to remove the fear spread about the health of the banking sector after the collapse of one bank after another in the country.

BBC reported that there is concern around the world that there may be a crisis in the banking sector of the United States.

Among them, the US regulatory authorities have welcomed the move by the banks to rescue First Republic.

And the big banks are saying that this move is a reflection of their strong ‘confidence’ in the banking sector.

Banks have plenty of cash and are making huge profits, they say.

“This situation will not be shaken even by recent events. “This move by America’s largest banks is a reflection of their confidence in the nation’s banking system,” said the 11 banks.

News of the bailout by a group of banks led by JP Morgan and Citigroup also boosted US stocks, with First Republic shares rising more than 20 percent at one point, leading to a temporary halt in trading.

Lately, the bank’s shares have started selling lower again, raising concerns.

The bank is set to be the next at risk as customers rush to withdraw their deposits, with investors worried that the San Francisco-based bank’s share price has plunged nearly 70 percent over the past week.

“This kind of support from a group of big banks is welcome, it shows the strength of the (US) banking sector,” US Treasury officials said.

Source link