- Financial Survival Network
- Posts
- First Republic Bank’s “Rescuers” Had Underwritten $3.6 Billion of its Preferred Shares, Which Have Lost 65 to 70 Percent of Their Value Year-to-Date
First Republic Bank’s “Rescuers” Had Underwritten $3.6 Billion of its Preferred Shares, Which Have Lost 65 to 70 Percent of Their Value Year-to-Date
by Pam Martens and Russ Martens Wall Street on Parade
Four of the eleven big banks that announced on March 16 that they were going to dump a combined $30 billion of their own money as uninsured deposits into the plunging coffers of First Republic Bank were also the underwriters of $3.6 billion in preferred stock for First Republic Bank. Units of JPMorgan Chase, Bank of America, Morgan Stanley and Wells Fargo were underwriters of the majority of the preferred stock outstanding at First Republic Bank. UBS, which did not contribute to the $30 billion deposit infusion, was also one of the primary underwriters. UBS was otherwise occupied last month by having a gun put to its head by the Swiss government to “rescue” the tanking Credit Suisse. The Swiss government also denied shareholders on both sides of the deal the ability to vote on the matter.
All of First Republic’s outstanding preferred stock was issued at $25 a share. Year-to-date those shares have lost 65 to 70 percent of their market value. As of yesterday’s closing bell, the seven series of Preferred (Series H through N) closed between $5.86 and $6.52. (See chart above.)