Mar 22, 2023
Blankfein Criticizes First Republic’s $30 Billion Rescue by Big Banks
(Bloomberg) -- The $30 billion rescue plan the biggest US banks offered First Republic Bank last week wasn’t the ideal path for helping the California lender, said former Goldman Sachs Group Inc. Chief Executive Officer Lloyd Blankfein.
“I don’t find that very confidence-inspiring, because I don’t think they’re really doing an analysis and deciding on good credit or a good investment,” Blankfein said in a CNBC interview Wednesday. “They’re not doing it out of a commercial analysis or the prospects of that institution. They’re doing it because they’re being asked to do it.”
JPMorgan Chase & Co., Bank of America Corp., Citigroup Inc. and Wells Fargo & Co. last week pledged $5 billion of uninsured deposits each to San Francisco-based First Republic, with seven other banks offering smaller amounts, to stem the turmoil that has sent depositors fleeing from regional banks. The bank Blankfein once led was among those making deposits, with Goldman and Morgan Stanley each kicking in $2.5 billion.
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