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US regulators are considering expanding an emergency credit line for banks that would potentially give First Republic Bank additional time to shore up its balance sheet.
An Expansion of the Federal Reserve Emergency loan is just one of several options being evaluated at an early stage, according to a Bloomberg report on Saturday, who cited well-known people.
Officials have yet to decide what support they can give to the First Republic (New York Stock Exchange: FRC), Bloomberg said. Watchdogs view the bank as stable enough to operate without any immediate intervention while it works on a deal to fix its balance sheet.
Late on Wednesday, Fitch Ratings downgraded First Republic’s (FRC) long-term issuer default rating to B from BB late on Wednesday, taking it further into junk territory. On Tuesday, Reuters reported that First Republic was now looking at options on how it can sell parts of its business, including part of its loan book, in a bid to raise cash and cut costs.
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