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First Republic Stock Plummets

Shares of First Republic Bank are plunging today!

First Republic’s first-quarter earnings showed massive deposit losses, sending the stock plummeting. Those declines accelerated to more than 44% Tuesday afternoon after Bloomberg reported the company is weighing an asset sale of up to $100 billion.

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Trading in the shares were halted due to volatility Tuesday afternoon; it has since resumed.

More than 700,000 contracts tied to the stock had traded with several hours remaining before the close, already the second-highest daily sum on record.

First Republic is the sixth most traded stock-options contract on Tuesday, Cboe data show.

Options traders are expecting whirlwind trading for regional-banking peer PacWest Bancorp following its earnings report, due after the close. PacWest’s daily losses increased to nearly 9% as of Tuesday afternoon after the First Republic report landed, from less than 3% in morning trading.

Investors expect a nearly 24% move for the stock tomorrow, according to Cboe’s calculation of implied volatilities in the options market.

Such trading hasn’t been seen in PacWest’s past earnings days, but First Republic’s losses today have regional lenders’ viability under the microscope.



Image: First Republic