First Republic Bank - Contagion

Mike Roffler has every reason to feel hard done by. The former chief executive officer of First Republic Bank is one of a small number of leaders to have presided over a banking failure.

By and large, they are a vilified group, their firms’ collapse all too often blamed on poor management, flawed risk controls and skewed incentives.

But Roffler is different. 

“but what I can say is that what happened to First Republic was not mismanagement, it was the element of contagion.”

A post-mortem report released by the Federal Deposit Insurance Corporation (FDIC) last week backs up Roffler’s claim. 

So if management was so strong and regulators didn’t spot anything of concern, why did First Republic fail? 

The post-mortem report has this to offer: “In retrospect, it does not appear that banks or banking regulators had sufficient appreciation for the risks that large concentrations of uninsured deposits could present in a social media-fueled liquidity event.”

Marc Rubinstein 13 september 2023

Englund: Silicon (


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