Finance
First Republic Faces Potential Curb on Borrowing From Fed
- FDIC considers lowering bank’s ratings if deal isn’t reached
- Doing so would likely limit firm’s access to Fed’s facilities
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US bank regulators are weighing the prospect of downgrading their private assessments of First Republic Bank — a move that may curb the troubled firm’s access to Federal Reserve lending facilities.
The Federal Deposit Insurance Corp. has been giving the bank time to reach a private deal to shore up its finances. But as weeks keep passing without a transaction, senior officials are increasingly weighing whether to downgrade their scoring of the firm’s condition, including its so-called Camels rating, according to people with direct knowledge of the talks. That would likely limit the bank’s use of the Fed’s discount window and an emergency facility launched last month, the people said.