First Republic on Downgrade Watch at Moody’s Over Outflow Risk

Moody’s put all long-term ratings of First Republic Bank on review, as the collapse of Silicon Valley Bank reverberates across the sector.

“The review for downgrade reflects the extremely volatile funding conditions for some US banks exposed to the risk of uninsured deposit outflows,” Moody’s said in a statement, citing a “material” amount of deposits above the Federal Deposit Insurance Corporation threshold.

“Ratings could be downgraded if the bank’s deposit base has eroded markedly, triggering asset sales, loss crystallization and a higher reliance on market funding,” it said.

The assessment comes after US bank stocks slid on Monday. ...