Why First Republic Bank (FRC) may be on track to make up its previous heavy losses.
First Republic Bank has been hovering around $14 per share for the past few days. The short sellers weren’t able to capitalize on $5 or even $10 puts that expired on the 24th of March. Tomorrow, we will see whether they will get their chance with $15 puts set to expire on the 31st. The flatlining that has been occurring with First Republic’s stock could be an indicator that FRC is slowly going to fluctuate on the upside. Considering reports that First Republic bank has ceased looking for a buyer which could have potentially diluted the stock value, or caused something similar to Credit Suisse’s stock being cut in half after Swiss regulators negotiated its buyout by rival Swiss bank UBS (where 22.48 CS shares were equivalent to 1 UBS share).
Private wealth fund brokers jumping ship, before it sails to safe harbor?
With first Vishal Bakshi leaving First Republic to join Morgan Stanley, the Marchetti team (named after its leader James B. Marchetti) which includes James L. Marchetti, and Caleb Porter, along with staff members Alicia Powell, Ellen Sibenlist and Stacy Swain is the latest to jump ship. The Marchetti team is departing to join the Rockefeller Global Family Office. While normally this could be interpreted as bad news or a lack on faith on the part of First Republic’s former employees, it might mean that First Republic will be left with employees that are not only more loyal, but more cautious since rather than jumping ship when times get tough, they will be the one steering away from potential storms or icebergs. Time will tell.
Ultimately, the good news from last week, combined with the flatlining of the stock this week could potentially signal the eventual return of First Republic stock closer towards its pre-crisis prices.