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Post by bobfl on Apr 26, 2023 16:30:39 GMT
When I bought back in the market last spring I made a list of all the investment grade preferreds. From that list I bought a diversified group, including First Republic. I signed up for the emailing list for each company. I started getting some weird SEC filings from FR and got out of FR. Did not lose anything, because no bank problems, yet.
Today a typical First Republic preferred has dropped to $2.55 (from a $25 issue price), paying out 41%.
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comlb
Lieutenant
Posts: 67
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Post by comlb on Apr 26, 2023 16:57:51 GMT
what were the filings that caused you concern?
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Post by bobfl on Apr 26, 2023 17:42:45 GMT
what were the filings that caused you concern? So many insiders selling big chunks of stock. Then a full investment team leaves and supposedly that team was their claim to fame. Also they issued a large amount of new stocks. I wondered why the heck they needed all that money. Nothing showed that need. Plus heavily traveling back and forth to Florida trying to get new clients. They were known for wealthy clients. |
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Post by bobfl on Apr 28, 2023 13:43:33 GMT
what were the filings that caused you concern? In my response I mentioned an investment team that left FR. That was a red flag to me. That departure happened well before FR crashed. I concluded that I don't need a company having internal problems. So I sold. Again today, the same type of headline from Barron's: $1.3 Billion Team Quits First Republic, Jumps to JPMorgan
It's not one person; it is another whole team. (It might have been part of the bailout deal JPM did with FR.) Between the first exodus and this one they bought a company to get some advisors. Supposedly advisors were what FR was noted for and why they had wealthy clients. But no one wants an unstable group. Anyway, there are a lot of companies to buy that are very visible and appear to be solid. Why buy debt from a company with red flags and that were not that visible because of their size. Don't get me wrong I only held them for about 2 months, until I replaced them. During that time I also replaced other companies with more conversative picks (in my opinion). This was all before the banks had issues. |
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Post by johnsmith on Apr 28, 2023 14:05:08 GMT
appreciate you posting your process, it's something I can learn from.
Thank you so much for sharing.
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Post by bobfl on Apr 28, 2023 15:32:23 GMT
Thanks Johnsmith.
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Post by anitya on Apr 28, 2023 17:49:52 GMT
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Post by bobfl on Apr 28, 2023 18:03:48 GMT
It's on the first page of the Form K-8 (your first link). More info from QuantumOnline.com: "Symbol Security Exchange FRC First Republic Bank NYSE FRC-M First Republic Bank, 4.0% Dep Shares Non-Cumul Perp Series M Preferred Stock NYSE FRC-K First Republic Bank, 4.125% Dep Shares Non-Cumul Perp Series K Preferred Stock NYSE FRC-L First Republic Bank, 4.25% Dep Shares Non-Cumul Perp Series L Preferred Stock NYSE FRC-N First Republic Bank, 4.50% Dep Shares Non-Cumul Perp Series N Preferred Stock NYSE FRC-J First Republic Bank, 4.70% Dep Shares Non-Cumul Perp Series J Preferred Stock NYSE FRC-H First Republic Bank, 5.125% Dep Shares Non-Cumul Perp Series H Preferred Stock NYSE FRC-I First Republic Bank, 5.50% Dep Shares Non-Cumul Perp Series I Preferred Stock NYSE" Got this for you from QuantumOnline.com. More detailed info on each on that site. You can study each linked prospective also. Current prices per share: frc-m $ 1.54 frc-k $ 1.45 frc-L $ 1.52 frc-n $ 1.66 frc-j $ 1.62 |
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Post by bobfl on Apr 28, 2023 18:12:17 GMT
Anitya, I modified the answer I just provided to you, in case you read the older version. Also mentioned on page 1, 6 and 72 on the second link. Based on a very, very quick scan. |
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Post by anitya on Apr 28, 2023 18:24:15 GMT
You think I did not read the first page of the attachments I sent? That is all perpetual preferred stock (equity) not debt. Your subject line is - "I owned First Republic debt".
You probably did not mean to create false (or outrageous) headlines but it helps to be considerate of fellow members (including their time), assuming that is important to a thriving forum.
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Post by anitya on Apr 28, 2023 18:38:37 GMT
"So many insiders selling big chunks of stock."
I tried to find these. There were too many insider transactions forms filed and the few I looked at are not sells. On March 10, one of its Directors bought shares at $95 a share - I hope his spouse does not know what he does with money!
Do you by any chance have the approximate date(s) when the insiders were selling big chunks of stocks?
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Post by bobfl on Apr 28, 2023 19:14:55 GMT
Anitya,
Also mentioned on page 1, 6 and 72 on the second link. Based on a very, very quick scan.
Regarding your last post:
What an interesting response :-) Made my day.
To make you happy, call it what you want. I will ALWAYS refer to any money borrowed and owed as "Debt". Sorry if that bothered you SO much. There are four main classes of corporate debt instruments: Secured debt, Unsecured debt, Tax-exempt debt, and Convertible debt. Preferreds can fall in three of those categories.
Preferreds are stocks that act like bonds. It is borrowed money that was borrowed with the intention of it being paid back. Unlike equities. It is an IOU, like a bond, although issued like a equity. Some call it an equity; some a mini-bond.
Borrowers issue them to raise money from investors willing to lend them money for a certain amount of time. The Gov calls that type of borrowing, debt. I call preferreds debt because preferreds are borrowed money.
You can waste your time arguing that I blow up the internet by calling borrowed money debt. HA HA.
I call it debt; and will always call borrowed money debt, if they plan to pay it back!
Right or wrong I don't frickin care.
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Post by anitya on Apr 28, 2023 20:54:45 GMT
Anitya, Also mentioned on page 1, 6 and 72 on the second link. Based on a very, very quick scan. Regarding your last post: What an interesting response :-) Made my day.
To make you happy, call it what you want. I will ALWAYS refer to any money borrowed and owed as "Debt". Sorry if that bothered you SO much. There are four main classes of corporate debt instruments: Secured debt, Unsecured debt, Tax-exempt debt, and Convertible debt. Preferreds can fall in three of those categories.Preferreds are stocks that act like bonds. It is borrowed money that was borrowed with the intention of it being paid back. Unlike equities. It is an IOU, like a bond, although issued like a equity. Some call it an equity; some a mini-bond.Borrowers issue them to raise money from investors willing to lend them money for a certain amount of time. The Gov calls that type of borrowing, debt. I call preferreds debt because preferreds are borrowed money. You can waste your time arguing that I blow up the internet by calling borrowed money debt. HA HA.I call it debt; and will always call borrowed money debt, if they plan to pay it back!Right or wrong I don't frickin care. There is nothing to argue - this is not a matter of opinion. I was willing to give you the benefit of doubt but it seems you are more interested in digging yourself deeper and perpetuating financial falsehoods. The following from your last post - "[It is money borrowed and owed . . . It is borrowed money that was borrowed with the intention of it being paid back. Unlike equities. It is an IOU, like a bond. . . Borrowers issue them to raise money from investors willing to lend them money for a certain amount of time." FRC perpetual preferred stock do not create an obligation to repay nor have a term. They are not time bound except by the death (i.e., dissolution / liquidation) of the corporation. They are not an "IOU" like a bond - nowhere in the terms of the perpetual preferred stock do they provide this right to the holders of the perpetual preferred stock. Everybody makes an occasional factual mistake. When it is pointed out, the best thing to do is own up, make the necessary corrections, and move on. That is what the respected posters (e.g., yogibearbull and uncleharley) in this forum do. Good luck. |
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Post by richardsok on Apr 28, 2023 21:38:41 GMT
I don't have dog in this ring, bob, but I get there are important differences between preferred stock and corporate debt, as both are generally understood -- wherein bonds are supposed to rate higher in a corporate crisis or earnings shortfall, but preferreds are often understood to have some characteristics of both bonds and shares.
Legal and accounting distinctions are there to be compared, but are above my paygrade. You're not entirely wrong in general day-to-day use for small investors; still we should respect a poster who asks to express terms a bit more clearly.
If there's cause for contention here, it eludes me.
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Post by fred495 on Apr 29, 2023 2:04:30 GMT
Banks, including JPMorgan Chase & Co (JPM.NaE) and PNC Financial Services Group Inc (PNC.NaE), are vying to buy First Republic Bank (FRC.NaE) in a deal following a government seizure of the lender, Wall Street Journal reported on Friday.
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Post by Capital on Apr 29, 2023 17:56:39 GMT
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Post by fred495 on Apr 29, 2023 18:49:06 GMT
I purchased a CD at JP Morgan Chase through Fidelity several months ago. I also have a CD at First Republic. If, as has been reported, the FDIC were to "persuade" Chase to take over First Republic, the combined value of my two CDs at Chase would now exceed the $250,000 FDIC limit. A sale to Chase would likely mean that all of First Republic’s deposits would become accounts at the acquiring bank.
Curious if, through no fault of my own, the excess amount over the FDIC limit now suddenly becomes uninsured?
Fred
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Post by Capital on Apr 29, 2023 19:38:58 GMT
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Post by yogibearbull on Apr 29, 2023 22:25:26 GMT
There were 11 banks in the attempted private rescue of $FRC via deposit infusions (that didn't work):
Gr 1, $5 billion: $BAC, $C, $JPM, $WFC
Gr 2, $2.5 billion: $GS, $MS
Gr 3, $1 billion: $BK, $PNC, $STT, $TFC, $USB
From this list, serious contenders now seem JPM (Gr 1), PNC (Gr 3), BAC (Gr 1), USB (Gr 3). We should know by Sunday Noon/PM.
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Post by fred495 on Apr 30, 2023 1:58:17 GMT
Thanks for the helpful information, Capital. Much appreciated.
Fred
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Post by colorado on Apr 30, 2023 13:21:10 GMT
Not sure about the details of your Deposits, but if you have CDs in more than one account, the CDs are insured up to $250k in each account. In my purchasing of CDs, I always make sure I do not exceed $250k for CDs in any given account. I have been fortunate (so far) in not purchasing CDs in any bank that has failed, but I do abide by FDIC rules about protection for my CD investments. |
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Post by fred495 on Apr 30, 2023 14:05:44 GMT
Thanks, colorado, I am fully aware of the $250,000 FDIC insurance limit per account at any one institution. But, that wasn't my question.
Fred
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Post by Capital on Apr 30, 2023 18:46:03 GMT
Looks like the deadline for bids is 4pm eastern.
It would be nice if we could know something by the end of the day.
I'm in RF and it appeared to be in recovery last Friday. We will see.
RF suffered very little loss in deposits from 12/31/2022 to 03/31/2023.
I listened to their earnings call and much of what they are working on is maintaining their deposit level.
They are aware that they are currently being outbid on rates; however, they stressed that only their commercial clients and high end-retail clients were asking about higher rates.
They do know that this will not last much longer.
They are also my local bank; however, I only keep enough cash there to operate the few things I run thru the bank.
Have a nice rest of your Sunday if you are reading this. I have a new bottle of Gin that is requesting attention.
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Post by roi2020 on Apr 30, 2023 19:07:39 GMT
An announcement regarding the status of First Republic should be made before Asian stock markets open tomorrow morning.
The Tokyo Stock Exchange and Korea Exchange open at 09:00 AM local time (08:00 PM EST tonight).
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Post by yogibearbull on May 1, 2023 0:54:10 GMT
There is nothing in the news yet on FRC.
The US futures and Asian markets (Japan, Australia) aren't showing anything unusual.
All bids (possibly from JPM, BAC PNC, CFG USB) were due by 4pm Eastern, so we are a few hours past that. PNC is rumored to be in the lead. JPM and BAC are both already well over the 10% US deposits limits; CFG seemed a last minute addition; USB has its own issues. So, PNC seems to be an easier regulatory choice and is big enough to swallow parts of FRC. Clearly, FRC has to go through FDIC hands - the FDIC may have to keep some underwater HTM and real estate assets, and sell only the better parts. Nobody will buy the whole of FRC because the M&A rules will require immediate mark-to-market of the underwater HTM and real estate portfolio.
Edit/Add: I am monitoring Twitter. Some have posted that they can still logon to FRC website, so nothing has happened yet. One fellow said that JPM won the auction but I cannot verify it.
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Post by Capital on May 1, 2023 9:27:02 GMT
JP Morgan Chase is buying a majority of the assets of First Republic link |
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Post by colorado on May 1, 2023 13:45:10 GMT
Thanks, colorado, I am fully aware of the $250,000 FDIC insurance limit per account at any one institution. But, that wasn't my question. Fred This is what I read in your previous post, "I purchased a CD at JP Morgan Chase through Fidelity several months ago. I also have a CD at First Republic. If, as has been reported, the FDIC were to "persuade" Chase to take over First Republic, the combined value of my two CDs at Chase would now exceed the $250,000 FDIC limit. A sale to Chase would likely mean that all of First Republic’s deposits would become accounts at the acquiring bank. Curious if, through no fault of my own, the excess amount over the FDIC limit now suddenly becomes uninsured" In that previous post, you did not indicate what kind of accounts those CDs were being held in. Any given bank can hold well over $250,000, if the type of accounts are different at each bank, for the CDs being held. It gets a bit complicated to answer your question, without more details about the type of accounts at each bank. For example, at my brokerage, I can hold $250,000 for one bank CD in my taxable account, and $250,000 from the same bank in my IRA account, and all $500,000 is insured at that same bank, because they are in different kinds of accounts. Based on your last post, you are apparently already well versed in FDIC coverage details, so my query and statements were apparently not necessary. |
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Post by fred495 on May 1, 2023 17:25:03 GMT
Colorado said: "For example, at my brokerage, I can hold $250,000 for one bank CD in my taxable account, and $250,000 from the same bank in my IRA account, and all $500,000 is insured at that same bank, because they are in different kinds of accounts."
Thank you, colorado, but that is news to me. Much appreciated.
Apparently, I am not as well versed in FDIC coverage details as you assumed.
Fred
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Post by steadyeddy on May 1, 2023 17:38:10 GMT
JPM got a sweet deal. FRC common stock goes to zero. JPM is not picking up FRC's corporate debt nor preferreds. Has a loss-sharing deal with FDIC on mortgages.
Nice!!
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Post by colorado on May 2, 2023 13:02:39 GMT
Colorado said: "For example, at my brokerage, I can hold $250,000 for one bank CD in my taxable account, and $250,000 from the same bank in my IRA account, and all $500,000 is insured at that same bank, because they are in different kinds of accounts." Thank you, colorado, but that is news to me. Much appreciated. Apparently, I am not as well versed in FDIC coverage details as you assumed. Fred You may want to verify my statements from an Income Specialist at Fidelity. I personally have a bit of mistrust in what I read on financial discussion boards, and use brokerage specialists to validate what I read. |
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