First Republic Bank’s stock FRC fell nearly 7% in premarket trades after rising earlier in the day, ahead of the Federal Reserve’s policy meeting later Wednesday and decision on interest rates. With about 8 million shares trading hands, it’s the most active stock in the premarket. The Wall Street Journal reported late Tuesday that First Republic had tapped Lazard to help it review its options, and consultant McKinsey for post-crisis planning, citing people familiar with the matter. Options on the table include a sale, a capital infusion and asset sales, the sources said, according to the Journal. The outcome of today’s Fed meeting is unclear following the dramatic events of the past 10 days, which has seen the failure of Silicon Valley Bank amid a run on the bank’s deposits, along with the failures of two crypto-friendly lenders, Signature Bank and Silvergate Capital. Adding to the tension is the forced shotgun wedding of Credit Suisse and UBS in Switzerland last weekend. At the moment, the market probabilities are 73% for a quarter-percentage-point move and 27% for no move, according to the CME FedWatch tool. The market seems to be growing in confidence of a hike, analysts said, based on movements on the front end of the curve. First Republic, which has been caught up in the banking crisis because it has a similar profile to Silicon Valley Bank, rallied on Tuesday on reports JPMorgan Chase was helping to bolster its capital. It then tumbled about 9% in the after-hours session.
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