The daily business briefing: March 17, 2023

1. 11 big banks prop up First Republic in $30 billion deal

A group of 11 banks on Thursday agreed to deposit $30 billion in First Republic Bank to signal confidence in its finances following the sudden failure of three other midsize lenders. The deal includes $5 billion infusions from four of the biggest U.S. banks — JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo. Goldman Sachs and Morgan Stanley are kicking in $2.5 billion each. BNY Mellon, PNC Bank, State Street, Truist, and US Bank are contributing $1 billion apiece. The deal came as top financial officials scrambled to reassure the public their deposits were safe. Treasury Secretary Janet Yellen and Federal Reserve Chair Jerome Powell called it "most welcome."

The New York Times

2. Sanofi becomes 3rd drugmaker to slash insulin costs

French drugmaker Sanofi announced Thursday that it would slash prices of its insulin by up to 78 percent, and cap out-of-pocket costs on its most popular version of the life-saving diabetes medicine, Lantus, at $35 per month for patients with private insurance. Sanofi is the third major insulin producer to make drastic price cuts urged by politicians and patient advocates. Novo Nordisk and Eli Lilly recently cut U.S. insulin prices up to 75 percent and 70 percent, respectively. The 2022 Inflation Reduction Act capped Medicare beneficiaries' insulin costs at $35 a month. A 2020 survey by advocacy group T1International found one in four Type 1 diabetes patients rationed insulin due to the drug's cost.

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USA Today The Hill

3. ECB makes big rate hike despite bank turmoil

The European Central Bank on Thursday raised interest rates by a half-percentage point, showing it remained committed to aggressive action to fight high inflation despite concerns about the financial health of banks. The ECB said it would provide emergency support to banks if necessary. The ECB made similar rate hikes in February and December. Analysts had been expecting a smaller, quarter-point increase given market tensions that have spread since the collapse of Silicon Valley Bank. ECB President Christine Lagarde said policy makers would be careful not to add too much strain on the financial system with further rate hikes. "It's not business as usual," Lagarde said. "It is not possible at this point in time ... to determine what the path will be going forward."

The Wall Street Journal

4. Stock futures little changed as banks get some help

U.S. stock futures struggled early Friday as concerns about the banking system continued despite a deal by major banks to support First Republic, and a lifeline from Switzerland's central bank to Credit Suisse. Futures tied to the Dow Jones Industrial Average and the S&P 500 were down 0.3 percent and 0.1 percent, respectively, at 7 a.m. ET. Nasdaq futures were up 0.1 percent. The Dow and the S&P 500 rose 1.2 percent and 1.8 percent on Thursday, leaving them poised to end a bumpy week with gains. The Nasdaq surged by 2.5 percent on Thursday and was up 5.2 percent on the week, headed for what could be its best week since November.

CNBC

5. 'Biggest-ever' U.S. business mission heading to Vietnam

SpaceX, Netflix, and Boeing are among more than 50 companies traveling to Vietnam next week for the "biggest-ever" U.S. business mission to the Southeast Asian nation, Reuters reported Friday, citing the organizer, the US-ASEAN Business Council. The participants include defense, pharmaceutical, and tech companies. Vietnam, a nation of 100 million people, has become a booming manufacturing hub. It is now benefiting from a shift away from China prompted by U.S.-China trade friction, and a desire to diversify supply chains after recent bottlenecks hurt U.S. businesses. Vietnam needs new suppliers of helicopters and drones for its military as the Ukraine war saps the capabilities of Russia, long its main military partner.

Reuters