Banking crisis fears grip markets as First Republic plunges again – latest updates

Fears of a US banking crisis have been reignited, as investors dumped shares in First Republic on reports that White House officials were unwilling to intervene in the rescue process. 

Shares in First Republic fell to a record low, down by 22pc in early trading in the US, after it revealed earlier this week $100bn (£80bn) of withdrawals, sparking concerns about its financial health.

It comes after shares in First Republic dropped 48pc to a record low on Tuesday, when the beleaguered lender also said it was considering selling off between $50bn to $100bn worth of long-dated securities and mortgages to balance the books. 

The Financial Times had suggested earlier this week that First Republic was in talks with US authorities over emergency action. 

However, CNBC reported early on Wednesday in the US that government officials were currently unwilling to intervene in the First Republic rescue process.

It has sparked concerns over the pressures on the banking sector as a whole, dragging stocks lower across Europe, with the FTSE down 0.52pc over the day, and the CAC 40, the DAX and the Euro Stoxx 50 all in the red on Wednesday. 

Clifford Bennett, chief economist at ACY Securities, said: “From a banking crisis still hovering just beneath the surface to the realization Russia has long-range missiles that are incredibly accurate that no one has the capacity to stop, to the sharply higher China-US tensions, more sanctions against both Russia and China, and the likely further unravelling of global trade and the reemergence of higher inflation, risks are huge.”

Read the latest updates below.