First Republic Bank’s FRC-N deposits fell by $72-billion in the first quarter, overshadowing market-beating profit and sending its shares down 15% in extended trading on Monday.
The lender also said it expects to reduce its workforce by nearly 20-25 per cent in the second quarter.
First Republic came into intense focus after Silicon Valley Bank (SVB) and Signature Bank collapsed last month, shaking the confidence in U.S. regional banks and prompting customers to move billions of dollars to bigger institutions.
“With the closure of several banks in March, we experienced unprecedented deposit outflows,” said Neal Holland, Chief Financial Officer.
Deposits fell to $104.47-billion from $176.43-billion in the fourth quarter despite the lender getting a $30-billion lifeline in combined deposits from U.S. banking behemoths, including Bank of America Corp., Citigroup Inc., JPMorgan Chase & Co and Wells Fargo & Co.
The lender earned $1.23 a share in the first three months ended March, comfortably above 85 cents analysts estimated for the quarter, according to Refinitiv data.