Moody’s serves downgrade warnings to six regional banks, including First Republic

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Moody’s late on Monday put six banks on review for possible downgrade as it also said it will withdraw ratings on collapsed Signature Bank.

The downgrade warnings may put further pressure on regional banks after the collapse of SVB Financial

and Signature Bank
The warnings were on First Republic, Intrust Financial , UMB Corp
Zions Bancorp
Western Alliance and Comerica

In First Republic’s case, Moody’s blamed the bank’s high reliance on uninsured deposits, its high amount of unrealized losses, as well as a low capitalization relative to peers, though it gave credit to its “official sector borrowing capacity” and its strong franchise in private banking and private wealth management for high-net-worth individuals.

The Invesco KBW Regional Banking ETF

fell 7% on Monday, and First Republic

stock dropped by 62%.

The mood music was better on Tuesday, with First Republic stock up 21% in the premarket, with Western Alliance

shares up 13%.


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