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First Republic Bank's Advisers Secure Potential, New Stock Buyers

According to sources cited by CNBC on Wednesday, First Republic Bank (NYSE: FRC) has had its advisers line up potential purchasers for new stock to aid the bank's balance sheet (NYSE: FRC). This move comes amid the bank's ongoing struggle to regain stability.

First Republic Bank logo
First Republic Bank logo

Shares Fall as First Republic Bank Seeks Recovery Options

The embattled lender experienced a sharp drop of over 10% in premarket trading after reaching a record low in the previous session. First Republic Bank is exploring limited and challenging options for a turnaround, such as creating a "bad bank" or engaging in asset sales, as reported by a source familiar with the matter to Reuters.

"Bad Bank" Option Explored Amid Banking Crisis

The "bad bank" concept is a crisis-management technique that separates problematic financial assets. First Republic Bank is considering this option after experiencing significant deposit flights during the recent banking crisis.

First Republic Bank Reports $100 Billion Deposit Drop

In the aftermath of the most significant banking turmoil since 2008, First Republic Bank reported a staggering decline of over $100 billion in deposits during the first quarter.

Bank Struggles with Customer Assurance and Liquidity

First Republic Bank has been facing numerous challenges recently, including assuring customers that their deposits are secure and convincing investors that the bank has the liquidity to overcome the crisis.