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(Reuters) - The U.S. Federal Deposit Insurance Corporation (FDIC) is preparing to place First Republic under receivership imminently, a person familiar with the matter said on Friday, sending shares of the lender down more than 40% in extended trading.
Shares of the bank closed down 43% after CNBC reported earlier in the day the lender was likely headed for receivership under the FDIC, worsening a stock rout that has wiped out 75% of its value this week.
The U.S. banking regulator decided the troubled regional lender’s position has deteriorated and there is no more time to pursue a rescue through the private sector, the source told Reuters, requesting anonymity because the matter is confidential.
Shares of the bank closed down 43% after CNBC reported earlier in the day the lender was likely headed for receivership under the FDIC, worsening a stock rout that has wiped out 75% of its value this week.
First Republic and FDIC representatives did not immediately respond to requests for comment.
Reporting by Medha Singh, Niket Nishant and Mehnaz Yasmin in Bengaluru; Editing by Saumyadeb Chakrabarty, Devika Syamnath and Anil D’Silva
