US contemplates expanding emergency lending facility for banks: Report
United States authorities are reportedly deliberating on extending an emergency credit line for banks, “in ways” which may provide First Republic Bank with a time buffer to address its balance sheet concerns, according to people with knowledge of the situation. In a March 26 Bloomberg report citing unnamed sources, it was reported that U.S. officials have not decided on what support, “if any,” they can provide to First Republic, however an “expansion of the Federal Reserves offering” is one of the options being considered. First Republic was reportedly deemed “stable enough to operate” by regulators without the need for “immediate intervention,” while the bank and its advisers attempt to “shore up its balance sheet.” The sources noted that while the Feds liquidity offerings would be reportedly expanded in accordance with banking law, which stipulates that it must be “broadly based” and not aimed at benefiting a specific bank, they also warned that the alteration could be “made in a way” that ensures First Republic Bank benefits. It was reported that despite First Republic facing structural challenges with its balance sheet, “the banks deposits are stabilizing” and is not at risk of experiencing “the kind of sudden, severe run” that led regulators to close down