First Republic Bank shares just crashed 50%. Here's how ASX 200 bank stocks are responding

Investors in the big four ASX bank shares will be keeping a close eye on the charts today following a 49% plunge in the First Republic Bank share price.

An older man wearing glasses and a pink shirt sits back on his lounge with his hands behind his head and blowing air out of his cheeks.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • After reporting massive deposit outflows, investors dumped First Republic Bank shares
  • The ASX 200 banks are holding their own today, largely in line with the benchmark index
  • The Aussie banks are the best capitalised in the world, which should offer investors some peace of mind

S&P/ASX 200 Index (ASX: XJO) bank stocks are holding their own in late morning trade on Wednesday.

Investors in the big four ASX bank shares will be keeping a close eye on the charts today following a 49.4% plunge in the First Republic Bank (NYSE: FRC) share price yesterday (overnight Aussie time).

We'll look at the latest ructions to hit the United States' banking sector in a tick.

First, here's how the big four ASX 200 bank stocks are tracking at the time of writing:

  • Australia and New Zealand Banking Group Ltd (ASX: ANZ) shares are up 0.04%
  • National Australia Bank Ltd (ASX: NAB) shares are down 0.49%
  • Westpac Banking Corp (ASX: WBC) shares are down 0.34%
  • Commonwealth Bank of Australia (ASX: CBA) shares are down 0.41%

For some context, the benchmark index is down 0.09% at this same time.

The ASX 200 bank stocks look to be getting plenty of support from their very strong common equity tier 1 (CET1) ratios. This is a measurement of the core equity capital of a bank compared to its risk-weighted assets.

As The Motley Fool reported earlier in April, Australia's big four banks are the most capitalised in the world. That should offer Aussie investors some peace of mind amid the banking turmoil hitting the US and Europe.

Now, here's why investors were hitting the sell button on First Republic Bank.

ASX 200 bank stocks resilient amid new US bank meltdown

The First Republic Bank share price crashed overnight following the release of the bank's first-quarter results.

As you can imagine by the sell-off, those results fell well short of expectations.

Among the big negatives, the bank reported its deposits decreased by US$105 billion over the three months.

Investors are already on edge following the collapse of Silicon Valley Bank and Signature Bank in March. That financial contagion quickly spread to Europe, resulting in the takeover of beleaguered Credit Suisse by Swiss rival UBS.

While ASX 200 bank stocks escaped the worst of that fallout, shares in the big banks did slide during March. Today, however, they're showing resilience.

Commenting on the deposit outflows that helped send the First Republic share price into a nosedive, chief financial officer of First Republic Neal Holland said:

With the closure of several banks in March, we experienced unprecedented deposit outflows. We moved swiftly and leveraged our high-quality loan and securities portfolios to secure additional liquidity. We are working to restructure our balance sheet and reduce our expenses and short-term borrowings.

With First Republic already having received US$30 billion in emergency funding from larger banks last month, it remains to be seen how this plays out.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Bank Shares

A man in a suit smiles at the yellow piggy bank he holds in his hand.
Bank Shares

Why this expert prefers NAB over CBA shares

For this fund manager, the biggest bank is not the best pick.

Read more »

View of a business man's hand passing a $100 note to another with a bank in the background.
Bank Shares

With a forecast dividend yield of over 7%, is this ASX bank share a buy?

The bank is offering significant passive income. Is it attractive?

Read more »

A man thinks very carefully about his money and investments.
Bank Shares

How much will the ASX 200 bank and mining shares pay in dividends in 2026?

The Australian market's reputation for strong dividends has relied on the big banks and miners. Can we still rely on…

Read more »

A man smashes open a piggy bank with a hammer representing an ASIC fine received by Westpac
Bank Shares

$10,000 invested in Westpac shares 10 years ago is now worth…

Here’s how much the major Aussie bank is worth.

Read more »

A man thinks very carefully about his money and investments.
Bank Shares

Is the CBA share price a buy in the lead-up to its FY25 result?

Should investors invest in CBA before its report?

Read more »

a woman holds her hands to her temples as she sits in front of a computer screen with a concerned look on her face.
Bank Shares

Why did the CBA share price tumble 4% in July?

Australia's largest bank had a tough time last month. But why? Let's find out.

Read more »

Overjoyed man celebrating success with yes gesture after getting some good news on mobile.
Bank Shares

Is the NAB share price a buy after the surprise positive news?

Are NAB shares attractive after a recent update?

Read more »

A businessman sits on an armchair adrift at sea.
Bank Shares

How the tide turned negative for ASX 200 bank stocks in July

Here’s why the tide looks to be turning for the big Aussie banks.

Read more »