.firstrepublic Bank is hemorrhaging value after its rating was cut to junk status amid broader fears about the banking sector in the wake of the collapse of Silicon Valley Bank. Standard and Poors changed First Republic's credit rating to BB+ from A-.
The credit rating agency moved the San Francisco-based bank’s long-term issuer credit rating to BB+ from A-. The group said that the bank has a higher risk of depositors pulling out their money, even after the government action this week to stop a run on the banks.“We believe that First Republic’s deposit base is more concentrated than most large U.S. regional banks, which presents heightened funding risks in the current environment,” S&P said.
Shares of the bank were down about 15% within an hour of the opening bell as investors fled the stock, fearing that First Bank, too, could fall victim to SVB’s fate.
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