First Republic Bank and ESG, DIE, RE

First Republic Bank (FRB) was heavy in save the planet narrative but cannot save itself now.

Go woke and climate dramatist, go bankrupt.

Why Global Decarbonization Bodes Well for the Economy and Planet
Christopher J. Wolfe, Chief Investment Officer, First Republic Private Wealth Management
February 17, 2023
https://www.firstrepublic.com/insights-education/why-global-decarbonization-bodes-well-for-the-economy-and-planet

FRB's passion reflected in statements by Mr. Wolfe, bank CIO, of decarbonization, investment away from fossil fuels. Then fossil fuels made big money in 2022 while they did not, perhaps tied up on anemic revenue RE and Fed interest rates jumped high.

High uninsured deposits was a key factor but woke, high focus on climate, ESG, DIE (diversity inclusivity equality) concerns contributed. From their 2021 CSR report page 49, they bragged they have zero lending to fossil fuels, where bigger returns could have been made. See the highlights too, below.

Sustainable Culture and Community Engagement at First Republic
2021 Corporate Responsibility Report

https://www.firstrepublic.com/-/media/frb/documents/pdfs/commitment-to-the-community/corporate-responsibility-report_2021.pdf

When you purchase 100% of your energy needs from RE, you automatically bloat your expenses 100%. RE is never cheap, that's why in the PH, RE has feed in tariff (FIT) or guaranteed high price for 20 years. RE also has priority dispatch to the grid: if coal or gas says "we can sell at P5/kwh" but RE is available at WESM price P8/kwh, RE will be prioritized, not coal or gas.

Save yourselves guys, the money of your depositors and investors, the jobs of your employees.

Don't save the planet, it does not need any savior. The planet has been around for 4.6 B years just coasting along warming-cooling cycles.

High focus on DIE, see their chart on page 13, CSR report 2021. An applicant need not be so bright in prudent investing so long as he/she is non-white, a woman, high chance of being hired.

One can perhaps say that all the factors they highlighted there -- ESG, DIE, RE, lending to underserved communities, grants to nonprofits, etc -- have contributed to their belly up. These are non-core banking yet they spent big resources on these.

Core banking is making sure you lend to people or groups that can generate revenues and profits to pay you back so you can expand. If fossil fuels can generate big profit to companies, lend money to these companies. But FRB said zero lending to fossil fuels.