Winning Bizness Desk

Mumbai. To save the First Republic of America from drowning, 11 big banks of America have come together to rescue it and therefore, these banks will infuse capital of $ 30 billion (about Rs 2.5 lakh crore) in the First Republic so that its depositors do not face any problem in withdrawing money. These 11 banks include JP Morgan, Citigroup, Bank of America, Wells Fargo, Morgan Stanley, US Bancorp, Truist Financial, PNC Financial. JP Morgan, Bank of America, Citigroup and Wells Fargo will infuse $5 billion each. Goldman Sachs and Morgan Stanley will put in $2.5 billion. Rest of the banks will also infuse small amounts of capital. Earlier on Sunday, First Bank issued a statement saying that it had received access to $70 billion in funds from JP Morgan and the Federal Reserve.

This shows the resilience of banking system

The investing banks said in their statement that this step reflects their confidence in First Republic and banks of all sizes. US Treasury Secretary Janet Yellen, Federal Reserve Board Chairman Jerome Powell and Federal Deposit Insurance Chairman Martin Grunberg issued a joint statement and said that this move of the banks is very welcoming. This shows the resilience of our banking system.

First Republic bank's shares dropped by 70%

Since March 6, there has been a sharp decline in the shares of First Republic. The bank's shares were broken by about 70%. Its stock had closed at $122 per share on March 6. Then on March 8, it came down to $115 per share. At one point on March 16, it slipped below $20, but after that the news of the help of banks returned strongly and it climbed almost 10% to close at $34.27.