The government’s Plunge Protection Team of high-level financial officials is even busier this weekend than last, when they urgently met to put together the bail-out of Silicon Valley Bank. This weekend it’s First Republic Bank, a medium-sized California bank with just over $200 billion in assets, which is hanging by a thin thread.
Earlier this week, on March 16, First Republic Bank had to be thrown a $30 billion lifeline to prevent it from going belly-up. Since Treasury Secretary Janet Yellen didn’t dare have the government openly carry out another bail-out—84% of all Americans are opposed to further bank bailouts, according to recent polls—she instead had a word with JPMorgan CEO Jamie Dimon and instructed him to do the dirty work along with other big banks. The result was $30 billion in cash deposited into First Republic’s accounts by nearly a dozen large banks.
“But it’s not clear it’s working,” former FDIC Chairwoman Sheila Bair warned on the CNBC television network on Friday, March 17. “This First Republic thing, it’s disappointing. I’m glad at least they didn’t use government support, that the private banks came in to try to stabilize it.… The problem is with this that fear becomes the major issue.”
