Jamie Dimon, CEO of JPMorgan, leads efforts to craft a New Primary Republic bank bailout

Eleven major banks met last week to deposit $30 billion into the First Republic in an effort to restore confidence in the lender. The Wall Street Journal previously reported that clients of the San Francisco-based bank have withdrawn about $70 billion since the collapse of the Silicon Valley bank earlier this month.

Some people said the plan could include banks converting some or all of the $30 billion in deposits into a capital injection.

The mode is flexible and fast moving. The First Republic is under intense pressure to reassure investors that it can survive. Its stock lost more than 90% in March. Shares closed down 47% at $12.18 Monday, after the newspaper first reported on the talks. This was the stock’s lowest closing price ever.

People familiar with the matter said a sale or an injection of outside capital were also options.

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One person said investment bankers have been hired to advise First Republic on its various options.

Mr. Dimon and his fellow CEOs are trying to instill confidence in a banking system facing its worst crisis in 15 years. Along with federal regulators, Dimon led efforts last week to support the First Republic, according to people familiar with the matter.

First Republic has become the latest focal point, as concerns about mid-sized US banks have spread widely across the global financial system over the past week and a half.

The rapid collapse of Silicon Valley Bank, a bank that caters to startups and their investors, has investors and customers worried about other regional banks with a similar picture. Like svbAnd

First Republic’s large share of uninsured deposits makes it vulnerable to run-in.

Two days after the collapse of SVB, the Federal Deposit Insurance Corporation said it had acquired Signature Bank, which also had an influx of deposits.

Then there was a sharp decline in the Credit Suisse group AG

The shares peaked last week in a hasty merger with crosstown rival UBS Group AG on Sunday.

Banking turmoil has shaken financial markets. But on Monday, some US regional banks led the stock market higher. Shares of New York Community Bank rose 32 percent after the bank agreed to buy many of Signature Bank’s loans and deposits.

Backwest Bancorp rose about 11%, US Bancorp rose about 5%, and Comerica rose about 5%. a company.

It was nearly 2%. The S&P 500 rose 0.9%, while the Dow Jones Industrial Average gained 1.2%. The technology-focused Nasdaq Composite rose 0.4%.

However, Monday’s gains weren’t big enough to put those banks back where they were trading before the Silicon Valley bank collapse. PacWest shares are still nearly 62% below their closing price on March 8th. US shares of Bancorp and Comerica are still down about 24% and 34%, respectively.

For investors, this incident exposed the differences between smaller, specialist lenders and the largest US banks, which have become tightly regulated and highly diversified after nearly crashing during the last financial crisis.

The strength of the big banks has left them in a position to help smaller competitors such as the First Republic.

Mr. Dimon and JPMorgan, the largest US bank by assets, have a long history of intervention during crises. JPMorgan bought Bear Stearns after its failure in 2008, and then took over operations of Washington Mutual Inc.

Mr. Dimon parlayed his crisis management into a statesman role among the bank’s executives. He’s the longest-serving CEO of the group, in the role since 2005, and regularly uses his rank to advise government officials and promote policy moves he says will help the economy.

His first intervention in the Republic mirrored the panic of 1907, when the semi-independent J. Pierpont Morgan rallied his fellow bankers to support a number of lenders who saw their deposits run off, helping to avert a nationwide financial crisis.

Recent banking turmoil has taken its toll on the First Republic. Deposit outflows slowed on Friday after the bank-led bailout, yet First Republic still has a big hole to fill its balance sheet.

“First Republic Bank is well positioned to manage its short-term deposit business,” a spokesman for the bank said on Sunday.

S&P Global on Sunday cut the First Republic’s credit rating even deeper into junk territory, saying last week’s deposit infusion may not be enough to overcome the bank’s “significant business, liquidity, funding and profitability challenges.”

Write to Ben Eisen at [email protected], AnnaMaria Andriotis at [email protected], and David Benoit at [email protected]