Another lifeline may come for First Republic Bank as JPMorgan Chase steps up to help

Investors are now turning their attention to the Federal Reserve, which is set to announce its next interest rate decision.
2:26 | 03/21/23

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Transcript for Another lifeline may come for First Republic Bank as JPMorgan Chase steps up to help
>> WELCOME BACK. CONCERNS ARE GROWING ABOUT ANOTHER US BANK FAILING. FIRST REPUBLIC BANK COULD BE RECEIVING AN ADDITIONAL LIFELINE FROM JPMORGAN CHASE. ABC NEWS BUSINESS REPORT ALEXIS CHRISTOFOROUS HAS MORE ON THAT AND YOUR OTHER BUSINESS HEADLINES TODAY. >> ALEXIS , WHAT ARE YOU WATCHING? WELL, FINALLY, A LITTLE BIT OF CALM RETURNING TO THE BANKING INDUSTRY TODAY. WALL STREET BUILDING ON YESTERDAY'S BIG RALLY AFTER TREASURY SECRETARY JANET YELLEN REASSURED AMERICANS THAT OUR BANKING SYSTEM IS STRONG. YELLEN EXPECTED TO TELL A BANKING CONFERENCE TODAY THAT THE FEDERAL GOVERNMENT COULD STEP IN TO PROTECT DEPOSITORS AT ADDITIONAL BANKS IF NEEDED. NOW, OF COURSE, THIS NEWS COMES JUST A DAY AFTER THE SWISS BANKING GIANT UBS CAME TO THE RESCUE AND AGREED TO TAKE OVER ITS EMBATTLED, SMALLER RIVAL, CREDIT SUISSE, FOR THREE BILLION DOLLARS. AND THOSE WILD MOVES WE'VE BEEN SEEING AND FIRST REPUBLIC STOCK ARE CONTINUING SHARES OF THE REGIONAL BANK BOUNCING BACK TODAY AFTER FALLING MORE THAN 47% YESTERDAY. THE HEAD OF JPMORGAN CHASE NOW REPORTEDLY ADVISING FIRST PUBLIC ON SOME STRATEGIC ALTERNATIVES, INCLUDING A POSSIBLE SALE. FIRST REPUBLIC HAS SUFFERED A TREMENDOUS NUMBER OF WITHDRAWALS FROM UNINSURED DEPOSITORS AFTER THE COLLAPSE OF SILICON VALLEY BANK. AND NOW INVESTORS ARE TURNING THEIR ATTENTION TO THE FEDERAL RESERVE, WHICH IS SET TO ANNOUNCE ITS INTEREST RATE DECISION TOMORROW. THE FED IS FACING ONE OF THE TOUGHEST CALLS IN YEARS. MOST ECONOMISTS EXPECT A SMALLER QUARTER POINT RATE HIKE TOMORROW AS THE FED CONTINUES ITS FIGHT AGAINST INFLATION. BUT DIANE , SOME BELIEVE THE FED COULD ACTUALLY HOLD OFF ON RAISING INTEREST RATES THIS TIME AROUND TO SORT OF LET THINGS SETTLE IN THE BANKING INDUSTRY. WE'RE ALSO NOW HEARING THE FDIC MIGHT EXPAND ITS COVERAGE TO INSURE AMERICANS BEYOND THAT. TWO HUNDRED AND FIFTY THOUSAND DOLLAR THRESHOLD. WHAT ARE YOU HEARING? I WOULDN'T HOLD MY BREATH, BUT THERE ARE SOME REGIONAL BANKS WHO ARE ASKING THAT THE GOVERNMENT TEMPORARILY LIFT THAT CURRENT CAP ON DEPOSIT INSURANCE IF ANOTHER REGIONAL LENDER WERE TO FAIL. BUT REPUBLICANS ARE PUSHING BACK HERE. THE HOUSE FREEDOM CAUCUS RELEASING THIS STATEMENT. ANY UNIVERSAL GUARANTEE ON ALL BANK DEPOSITS, WHETHER IMPLICIT OR EXPLICIT, ENSHRINES A DANGEROUS PRECEDENT THAT SIMPLY ENCOURAGES FUTURE IRRESPONSIBLE BEHAVIOR TO BE PAID FOR BY THOSE NOT INVOLVED WHO FOLLOWED THE RULES. SO WE HAVE A VERY DIVIDED CONGRESS. I DOUBT THIS WOULD PASS IN CONGRESS, BUT WE'LL SEE WHAT JANET YELLEN HAS TO SAY TODAY ON A LOT OF PEOPLE GOING TO BE WATCHING THAT SPEECH CLOSELY, ALEXIS CHRISTOFOROUS. THANK YOU. AND IF YOU WANT TO ASK ALEXIS ANY PERSONAL FINANCE

This transcript has been automatically generated and may not be 100% accurate.

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