Posted on 04/26/2024 6:17:46 PM PDT by george76
US regulators have seized Republic First Bancorp and agreed to sell it to Fulton Bank, the Federal Deposit Insurance Corp. said Friday, underscoring the challenges facing regional banks a year after the collapse of three peers.
The Philadelphia-based bank, which had abandoned funding talks with a group of investors, was seized by the Pennsylvania Department of Banking and Securities.
The FDIC, appointed as a receiver, said Fulton Bank, a unit of Fulton Financial, will assume substantially all deposits and purchase all the assets of Republic Bank to “protect depositors.”
Republic Bank had about $6 billion in total assets and $4 billion in total deposits, as of Jan. 31, 2024. The FDIC estimates that the cost to the Deposit Insurance Fund related to the failure of Republic Bank will be $667 million.
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The decision marks the latest regional bank failure following the unexpected collapses of three lenders – Silicon Valley and Signature in March 2023 and First Republic in May.
Republic Bank had struck a deal with an investor group that included veteran businessman George Norcross, high-profile attorney Philip Norcross late last year, but that was terminated in February.
After that deal collapsed, the FDIC resumed efforts to seize and sell the bank,
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The bank’s stock price has tumbled from just over $2 at the start of the year to about 1 cent on Friday, leaving it with a market capitalization below $2 million.
Its shares were delisted from the Nasdaq in August and now trade over the counter.
(Excerpt) Read more at nypost.com ...
I CAN”T BELIEVE FUTON BOUGHT IT>THAT”S A SMALL BANK TOO>
“ I have never seen an article as to why this practice was so wide spread in the industry.”
Reserves are highly regulated. Government debt is considered a “safe harbor” (free from regulatory problems) for banks. When yields for short term treasuries was near zero 10 year rates at 1% or so looked attractive at the time.
Some banks overdid it.
Commerce CEO lives in south Jersey down next town over from me (in a way nicer house). It was indeed a local that went sorta regional.
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