Credit Suisse was in focus as investors watched for weak links in the European financial system following the collapse of three smaller US firms. — Bloomberg Bloomberg
A US$30 billion lifeline for First Republic Bank hosed down market fears about an imminent banking collapse on Friday, but a late tumble in the troubled U.S. lender's shares showed investors were still worried about cracks in the sector.
Large U.S. banks injected the funds into the San Francisco-based bank on Thursday, swooping in to rescue the lender caught up in a widening crisis triggered by the collapse of two other mid-size U.S. lenders over the past week.
DEVELOPMENTS
* First Republic Bank received $30 billion in deposits from several big banks, the banks said in a statement on Thursday, as part of a rescue package for the lender. Involved in the rescue are JPMorgan Chase & Co, Citigroup Inc, Bank of America Corp, Wells Fargo & Co, Goldman Sachs Group Inc, Morgan Stanley and others.
* Despite the rescue, First Republic's shares fell 17% in extended trading on Thursday, after it said it was suspending its dividend.
* Banks sought record amounts of emergency liquidity from the Federal Reserve over recent days in the wake of the failure of Silicon Valley Bank and Signature Bank, which in turn helped undo months of central bank efforts to shrink the size of its balance sheet, Fed data showed on Thursday.
* U.S. Treasury Secretary Janet Yellen said the U.S. banking system remains sound and Americans can feel confident that their deposits are safe.
* Credit Suisse said it was taking "decisive action" to strengthen its liquidity by exercising its option to borrow from the Swiss National Bank up to 50 billion Swiss francs ($54 billion).
* The European Central Bank raised rates by 50 basis points as promised, acknowledging market strains and pledging liquidity support if needed, but also underscoring eurozone banking sector's resilience.
* Credit Suisse's average liquidity coverage ratio, a measure of how much cash-like assets the bank has, did not change between March 8 and March 14, the Swiss lender said on Thursday, despite the global banking crisis.
* Credit Suisse CEO Ulrich Koerner told staff to focus on facts as he pledged to rapidly move forward with a plan to streamline operations.
* Wall Street bank JPMorgan said that Credit Suisse's takeover by another lender, probably its Swiss rival UBS, was the most likely scenario for the embattled bank.
* Japan's finance ministry, financial regulator and central bank said their officials will meet on Friday to discuss market developments.
* UBS Group AG and Credit Suisse Group AG are opposed to a forced merger, Bloomberg News reported on Thursday, citing people with knowledge of the matter.
MARKETS
* Asian markets extended a risk rally on Wall Street on Friday to end a tumultuous week that saw the banking crisis send bond yields plunging while market participants sharply lowered expectations of future interest rate hikes in Western economies.
* The U.S. dollar slipped on Friday after authorities and banks moved to ease stress on the financial system, taking the heat off most major currencies that tumbled this week in the wake of bank turmoil. - Reuters
