Eleven US banks announce $30 billion rescue package for First Republic

Eleven of the biggest banks in the United States announced a USD 30 billion rescue package for First Republic Bank on Thursday, in an effort to prevent the California-based bank from becoming the third bank to fail in less than a week.

First Republic serves a similar clientele as Silicon Valley Bank, which failed Friday after depositors withdrew about USD 40 billion. It appears that First Republic, which had deposits totalling USD 176.4 billion as of December 31, was facing a similar crisis.

In a statement, the group of banks confirmed that other unnamed banks had seen large amounts of withdrawals of uninsured deposits, which are those that exceed the USD 2,50,000 level insured by the Federal Deposit Insurance Corporation. First Republic's shares dropped more than 60 per cent Monday, even after the bank said it had secured additional funding from JPMorgan and the Federal Reserve.

Thursday the bank's shares were down as much as 36 per cent but rallied after reports the rescue package