Credit Suisse lowered the firm’s price target on First Republic to $11 from $130 and keeps a Neutral rating on the shares. The company’s March deposit outflows and the shift in funding mix have seriously impaired the earning power of First Republic, the analyst tells investors in a research note. Factoring in the shift to a higher cost funding mix and assuming an accelerating pace of loan portfolio runoff, the headwind to wealth management revenue , and implementation of expense reduction initiatives translates to a forecast operating earnings per share of ($4.15) and ($1.10) for 2023 and 2024 respectively, the firm added.
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