Shares of banks and other financial institutions fell amid fears that the failure of First Republic Bank would not be the end of the banking crisis.
The Federal Deposit Insurance Corp. seized First Republic after the California lender lost $100 billion in deposits during a run on the bank triggered by a similar event at another San Francisco-area bank that catered to the wealthy -- Silicon Valley Bank. Three of the four largest bank failures in U.S. history have happened since mid-March.
Over the weekend, the FDIC brokered a deal whereby JPMorgan Chase would take over Republic Bank's obligations and purchase most of its assets after winning an auction. The FDIC will share losses with JPMorgan on Republic Bank's loans. PacWest Bancorp, another California lender under stress, fell 11% to $9.07 amid fears it could be the next domino in the chain.
Shares of Global Payments fell sharply after the provider of point-of-sale equipment and other payment technology said its chief executive was stepping down in June. The abrupt replacement of Chief Executive Jeff Sloan with President and Chief Operating Officer Cameron Bready overshadowed first-quarter earnings that surpassed Wall Street targets, said an analyst at brokerage Mizuho.
Franklin Resources shares fell after the owner of Franklin Templeton mutual funds posted a drop in fiscal second quarter earnings as some clients pulled money out of its investment funds during a volatile period.
Write to Rob Curran at rob.curran@dowjones.com
(END) Dow Jones Newswires
05-01-23 1731ET
