Tumultuous weeks for First Republic investors as bank hit by liquidity crunch

Shareholders of First Republic Bank have been on a bumpy ride during a turbulent few weeks in which the company's stock has plummeted more than 70% so far in March.

The San Francisco-based bank's total return through March 16 was negative 72.1%, compared to negative 17.3% for the S&P U.S. BMI Banks index, according to S&P Global Market Intelligence data. The S&P 500 returned negative 0.1% over the same period.

The bank's shares lost nearly a third of their value during the March 17 trading session alone.

Banks squeezed amid liquidity crunch

Banking stocks have been battered following the liquidation of Silvergate Capital Corp. and the failures of Silicon Valley Bank and Signature Bank, which went into Federal Deposit Insurance Corp. receivership on March 12.

The failures raised concerns over liquidity conditions in the banking system at a time when the Federal Reserve is already fighting to contain inflation.

* Access detailed data on failed banks. * Take part in S&P Global Market Intelligence's U.S. Bank Outlook Survey — The State of U.S. Banks & Fintech. * Read more about the liquidity crunch and the fallout for the financial sector in our new Issue in Focus.

Following reports of Silicon Valley Bank and Signature Bank's high proportions of uninsured deposits, investors increased their attention to uninsured deposit totals and balance sheets at other institutions, including First Republic. First Republic has announced several efforts to shore up liquidity, including borrowing money from the Fed and securing a total of $30 billion of deposits from 11 financial institutions.

Top investors at First Republic

As of the end of 2022, the most recent date for which data was available, Vanguard Group Inc. was the largest investor in First Republic's stock. It owned 20 million shares at the close of last year, representing an 11.04% stake. Assuming its ownership in First Republic held steady, Vanguard's stake in the bank was valued at $704.7 million as of March 16.

Vanguard was followed by Capital Research & Management Co., which owned close to 14 million shares, for a 7.41% stake. The stake was valued at $473.2 million as of March 16.

BlackRock Inc., State Street Global Advisors and Alecta Pensionsförsäkring ömsesidigt rounded off the top five investors in First Republic at the end of 2022, with stakes in the bank representing 7.07%, 5.17% and 3.82%, respectively.