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- Banks That Put Up $30 Billion To “Rescue” First Republic May Have Been Trying to Rescue Their Own Exposure to $247 Trillion in Derivatives
Banks That Put Up $30 Billion To “Rescue” First Republic May Have Been Trying to Rescue Their Own Exposure to $247 Trillion in Derivatives
by Pam Martens and Russ Martens Wall Street on Parade
Ever since 11 banks on March 16 donned the garb of heroic fire fighters, rushing to extinguish an inferno at a competitor bank before it spread further, we have been asking ourselves the question – why just this group of 11 banks.
We’re talking about the action on March 16 when 11 banks chipped in a total of $30 billion and bizarrely placed those funds as uninsured deposits into First Republic Bank – which was in full scale unraveling mode because of bond losses and – wait for it – too many uninsured deposits. Four banks contributed two-thirds of the total deposits with JPMorgan Chase, Bank of America, Citigroup and Wells Fargo ponying up $5 billion each. Morgan Stanley and Goldman Sachs deposited $2.5 billion each; while BNY Mellon, State Street, PNC Bank, Truist and U.S. Bank each deposited $1 billion, together making up the other one-third of the $30 billion.