Alecta to lead class action against First Republic Bank

COPENHAGEN (Reuters) – Swedish pension fund Alecta said on Tuesday it had been appointed by a U.S. court to lead a class action against First Republic Bank aimed at recovering as much capital as possible that investors lost when the bank collapsed earlier this year.

U.S. regulators on May 1 seized First Republic Bank and sold its assets to JPMorgan Chase & Co, in a deal to resolve the largest U.S. bank failure since the 2008 financial crisis and draw a line under lingering turmoil in the industry.

Sweden’s largest pension fund provider lost 19.6 billion crowns ($1.92 billion) from share holdings in First Republic Bank and collapsed rivals Silicon Valley Bank and Signature Bank, and said on Tuesday it would take part in class actions against all three.

“We have a duty to take the legal measures we can to recover as much of the capital as possible after the collapse of First Republic,” Alecta CEO Peder Hasslev, said in a statement.

It normally takes years to reach a solution in a class action of this kind, however, and it is difficult to assess how much money Alecta might be able to recover, the pension fund provider said.

The process is being conducted with the help of U.S. litigation lawyers, Alecta added.

Norway’s sovereign wealth fund and Swedish pension fund AP7 were last week named co-lead plaintiffs in an ongoing class action relating to the now-defunct Silicon Valley Bank (SVB).

(Reporting by Louise Breusch Rasmussen; Editing by Terje Solsvik and Mark Potter)