The daily business briefing: April 25, 2023
First Republic lost $100 billion in deposits during panic, Bed Bath & Beyond shares dive after bankruptcy filing, and more
First Republic lost $100 billion in deposits
First Republic Bank reported Monday that customers took out $100 billion in deposits last month after two regional bank failures raised questions about the financial health of the industry. The bank said deposits fell more than 40 percent to $104.5 billion at the end of the first quarter. When the quarter started, deposits totaled $176.4 billion. The end of the quarter would have been gloomier, but First Republic received $30 billion in deposits from banking giants, including JPMorgan Chase & Co., to signal confidence. First Republic said its profit fell 33 percent in the quarter compared to the same period a year earlier. Revenue fell 13 percent. The bank's shares have fallen nearly 90 percent since March, The Wall Street Journal reported.
Bed Bath & Beyond shares plunge after bankruptcy filing
Bed Bath & Beyond shares plunged 25 percent on Monday after the struggling retailer filed for bankruptcy protection. The company announced Sunday it was holding a liquidation sale after failing to line up the funds it needed to continue operating. Bed Bath & Beyond now plans to use the Chapter 11 process to keep it going as it sells off inventory and salvages assets like its Buy Buy Baby stores. A bankruptcy judge on Monday authorized the company to borrow $40 million to keep it stable through the sale process. The company sent customers an email telling them they had until Wednesday to use any coupons they had at the 360 Bed Bath & Beyond stores or 120 Buy Buy Baby locations.
Reports: Jeff Shell ousted from NBCUniversal over sexual harassment complaint
Jeff Shell was forced to resign as NBCUniversal CEO after an internal investigation corroborated allegations of sexual harassment against Hadley Gamble, a CNBC overseas correspondent, multiple news outlets reported Monday. "The investigation into Mr. Shell arose from a complaint by my client of sexual harassment and sex discrimination," Suzanne McKie, a managing partner of Farore Law who represents Gamble, said in a statement to CNN. "Given these circumstances it is very disappointing that my client's name has been released and her privacy violated." Gamble, based in Abu Dhabi, anchors the Capital Connection broadcast.
GM, Samsung SDI plan joint venture to build U.S. EV battery plant
General Motors and Samsung SDI are expected to announce as early as Tuesday that they are building an electric-vehicle battery plant in a U.S. joint venture, Reuters reported. The news comes as South Korean President Yoon Suk Yeol makes the first state visit to Washington by a South Korean leader in 12 years. More than 100 South Korean corporate executives, including Samsung Executive Chair Jay Y. Lee, are accompanying Yoon, who has pushed business opportunities in foreign trips. GM and Samsung didn't immediately comment. A person at Samsung SDI said the companies "would likely have more than" one battery plant with GM in North America. U.S. automakers have been trying to diversify battery supplies to gain on Tesla, which dominates EV sales.
Stock futures slip as more earnings reports pour in
U.S. stock futures fell early Tuesday as investors continued to digest corporate earnings reports and brace for results from tech giants. Futures tied to the Dow Jones Industrial Average and the S&P 500 were down 0.5 percent at 6:30 a.m. ET. Nasdaq futures were down 0.4 percent. Shares of First Republic Bank fell 20 percent after it reported late Monday that deposits plunged in the first quarter panic over the health of regional banks. Amazon and Microsoft are scheduled to post quarterly earnings after trading ends Tuesday. UPS, 3M, Verizon, JetBlue, and General Motors report their earnings before the bell, as do large-cap heavyweights McDonald's and PepsiCo. GM and PepsiCo reported earnings that beat expectations and raised their 2023 guidance.