First Republic Group (NYSE:FRC) shares were seen extending their losses on Monday.
What Happened: In pre-market trading, the stock of the troubled regional bank plunged 21.58% to $18.06, according to Benzinga Pro data. The stock shed a whopping 32.80% on Friday despite private banks, led by JPMorgan & Chase Co. (NYSE:JPM), extending a lifeline by providing a $30 billion rescue package.
See Also: Best Financial Services Stocks Right Now
The bank, on its part, announced the suspension of its dividend as part of efforts to preserve liquidity.
Monday’s weakness could be attributed to Standard & Poor’s announcing a back-to-back downgrade of the bank’s credit rating. On Sunday, on the heels of a cut in the bank’s credit rating from A- to B+, S&P lowered it further to BB+, further into junk territory.
The rating agency said the deposit infusion should alleviate near-term liquidity pressures, but it is unlikely to ” solve the substantial business, liquidity, funding, and profitability challenges that the bank is now likely facing.
