Earlier this year three large U.S. banks failed in a sequence of events that has been called The Banking Crisis of 2023. While federal regulators acted decisively and forcefully to prevent the bank failures from triggering a contagion event, the underlying problems that caused the three banks to fail continued to trouble many other U.S. lending institutions. Among the banks that faced continued challenges and continuing questions is the California-based bank Pac West, which in July 2023 announced that as a way to try to deal with its woes it was being acquired by the Bank of California. Now, a plaintiff shareholder has filed a securities class action lawsuit against Pac West and certain of its directors and officers alleging misrepresentations in connection with the events surrounding the other banks’ failures ad leading up to the July merger. The new lawsuit is the latest example of the ways in which ongoing issues in the banking sector are leading to securities class action lawsuit filings. A copy of the new complaint can be found here.

Continue Reading Regional Bank Hit with Banking Crisis-Related Securities Suit

Earlier this year, challenges arising from rising interest rates, as well as concerns surrounding liquidity and other issues, led to three of the largest banking failures in U.S. history. The three that failed were not the only banks facing challenges in the rising interest rate environment, and while there have been no further failures since May, questions from the turbulence earlier this year remain for many banks. Now, in a sign that these kinds of challenges and questions can lead to securities litigation even in the absence of bank failure, a plaintiff shareholder has filed a securities class action lawsuit against KeyCorp (the bank holding company of KeyBank) after questions about the bank’s liquidity and interest rate income in a rising interest rate environment caused a drop in the company’s share price. A copy of the August 4, 2023, complaint filed against Key can be found here.

Continue Reading Liquidity and Interest Income Concerns Draw Securities Suit Against Bank

              

In the immediate aftermath of the banking crisis in mid-March, several of the key banks at the center of the crisis – including Silicon Valley Bank, Signature Bank, and Credit Suisse – were quickly hit with securities class action lawsuits. First Republic, another bank that suffered massive deposit withdrawals in March and that received a $30 billion infusion from J.P. Morgan and other large banks, has now been hit with a securities class action lawsuit after it announced its fiscal first quarter financial results on Monday. This latest lawsuit, only coming in as it does now, may fuel further uneasiness that the March banking crisis-related events, might not represent the end of the banking crisis story, nor the end of the related lawsuits.

Continue Reading First Republic Bank Hit with Banking Crisis-Related Securities Suit