Investing: First Republic Bank is a goner

First Republic’s logo

We bought 50 shares of First Republic, after the Silicon Valley Bank disaster. That was mistake #1. We doubled down and bought another 50 shares after earnings, and close to $100 billion in deposits were withdrawn last quarter. It seems likely First Republic Bank won’t exist on Monday morning. The FDIC is looking to seize the bank and sell it quick. It was our thinking that First Republic had good assets, and only needed some equity to stay afloat. Why not buy a good asset for cheap was our thinking? That’s probably the case. Whoever buys it will get First Republic for cheap, reduce competition, and go up the next day.

Our cardinal rule of not buying when the monthly MACD gave a sell signal was ignored. And we paid the price, losing about $2200.

First Republic gave a sell signal early last year. see the top MACD panel crossing down. If we noticed that, we would have saved ourselves a lot of trouble.

Along with having an asset-liability mismatch (holding long term mortgages and bonds while having lot of short term, uninsured deposits), First Republic was slow to raise deposit and CD rates. Wealth advisors have been jumping off the last few weeks. It was no doubt poorly managed.

If you have any puts on First Republic, first congrats, second, make sure to exercise your options manually. Otherwise, your winning trade won’t pay out.

If you own shares in FRC, you can register with the FDIC in hopes of getting some money back. It seems very unlikely.

Have a better investing day.

Sincerely yours,


Copyright © 2023 smilingdad. The content produced by this site is for entertainment purposes only. Opinions and comments published on this site may not be sanctioned by and do not necessarily represent the views of smilingdad, its owners, sponsors, affiliates, or subsidiaries.

Published by smilingdad

My story is one of tragedy and redemption. We've made many mistakes along the way regarding our money. Our goal here is to show you how to take care of your money life long, and as much as we can, help the Earth along the way. I call it sustainable personal finance and ethical capitalism. Currently, I am a part time writer for Cleantechnica and part-time licensed financial professional, along with being a full-time dad.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: