First Republic's Rich, Vocal Clients Mull What to Do With Their Money
At the same time, her firm set up a sweep to send any money above the FDIC’s $250,000 cap to other banks. Aligned also set up an account at Wells Fargo: “Not to use it, more as a backstop,” she said.
Ghia Griarte, an executive at private equity firm Ponte Partners, also opened an account at a bigger rival. “We don’t even know what we’re going to do” with it, she said. Having it just in case makes more sense than merely “panicking for the sake of panicking.”
As U.S. authorities grapple with the month’s collapses, they’ve considered expanding an emergency lending facility for banks that would give First Republic more time to shore up its balance sheet, people with knowledge of the situation have said.
Officials haven’t decided what if any support to provide and see the lender as stable enough to operate for now. That means its business continues.
Other Moves
Boston Youth Symphony Orchestras, featured on the bank’s website in June, has been negotiating with First Republic for a construction loan. Jean-Marc Berteaux, the group’s treasurer, said he wants to finish that deal “as long as they remain a going concern.”
But the group has approached two other lenders to be safe. Likewise, even while keeping millions with First Republic, the nonprofit has made calls to open a new account at a bigger bank, though they’ve gone unanswered.
Pulling all of its business wouldn’t make sense, Berteaux said. “I wish other nonprofits and clients had understood, so long as you’re not at risk you’re making things worse” by running away.
Sonja Perkins, an investor who had called First Republic the best bank she’s ever worked with, said she hasn’t “moved a penny.”
“I’m not going to join the chorus of Cassandras,” she said.
Out hiking this month in California’s Marin County, Hint Inc. co-founder Kara Goldin said she bumped into another First Republic customer.
“How about all this craziness?” Goldin asked the woman. The bank, they agreed, will figure it all out.
(Photo: Adobe Stock)
Copyright 2023 Bloomberg. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
