Even after the sale of the bank, the crisis is not over for other regional banks.
(Photo: AP)
Denver The relief didn’t last long. Just a day after First Republic Bank collapsed and was sold in large part to JP Morgan Chase, concerns about America’s regional banks are back in focus. Los Angeles-based PacWest lost 28 percent on Tuesday. The Metropolitan Bank of New York lost 20 percent. The regional banks’ KBW index slipped more than five percent, falling to its lowest level since November 2020.
The sell-off was also fueled by hedge funds that are betting on falling prices. This is according to a study by Goldman Sachs. “The turbulence in the banking world will probably not disappear any time soon,” warned Ed Moya from the analysis house Oanda. After the First Republic bankruptcy, investors had zeroed in on the “next, weak links in the chain”.
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