ETD - Republic First is not First Republic and other examples of corporate confusion

2023-04-02 15:45:00 ET

Republic First Bancorp ( NASDAQ: FRBK ) is having a bit of an identity crisis; its name is uncomfortably similar to First Republic Bank ( NYSE: FRC ), which was the subject of a megabank rescue earlier this month.

To address the confusion between the two names Republic First ( FRBK ) CEO Thomas X. Geisel plastered a red banner across the company website's home page: "Republic Bank is aware of recent news regarding the collapse of two major U.S. banks, and want to assure our customers that we remain in a safe and secure environment."

"We are Republic Bank Inc. (FRBK-Red/Blue Logo); we are NOT First Republic Bank (FRC-Green Logo)," Geisel stressed.

In the past month, San Francisco-based First Republic Bank ( FRC ) shares plummeted 89%. It serves clients similar to those of Silicon Valley Bank, which was shuttered on March 10 when its venture capital-backed customers rushed to withdraw deposits in a social media-driven panic. With depositors at First Republic ( FRC ) also nervous, a group of 11 of the country's largest banks came to its rescue by depositing a total of $30B into First Republic accounts.

In his message on the FRBK website, Geisel said there are important differences between his bank and First Republic ( FRC ). "We DO NOT lend to start-ups and are not involved in Crypto. We lend primarily to established businesses. We lend against collateral and cash flow, we lend to profitable companies that can service the debt, and we typically have personal guarantees," he wrote.

To be sure FRBK's stock price , down 30% in the past month , hasn't dropped as much as FRC's, but it has underperformed the KBW Nasdaq Bank Index ( BKX ), which fell 25%.

But Republic First ( FRBK ) is not the first, and certainly won't be the last, to get caught up in confusion regarding similar-sounding names or ticker symbols. Here are several over the last 20 years:

• Amid the crypto frenzy in 2021, Ethan Allen's ( ETD ) ticker, "ETH" at the time, was often confused for Ethereum ( ETH-USD ). The furniture retailer changed its trading symbol to "ETD" in August of that year.
• In February 202, Clubhouse Media Group ( OTCPK:CMGR ) stock surged on some investors' mistaken belief that it was related to the Clubhouse audo app . Clubhouse Media ( OTCPK:CMGR ), formerly known as Tongji Healthcare Group, is in the social media branding marketspace.
• Signal Advance ( OTCPK:SIGL ) stock more than quintupled on Jan. 11, 2021 after Elon Musk urged his Twitter followers to use Signal, a secure messaging service that's unrelated to SIGL.
• In July 2020, Tiziana Life Sciences ( TLSA ), a clinical biotech company, saw its stock drop 14%, likely as investors realized they hadn't bought Tesla ( TSLA ) shares. It was thought that Robinhood users were mistyping the TSLA ticker.
• When videoconferencing surged in 2020 due to COVID-19, Zoom Video Communications ( ZM ) saw its business soar. But trading also surged in Zoom Technologies (ZOOM), a largely defunct firm that once distributed wireless products and modems. On  Feb. 27, ZOOM had rocketed up 52% . The confusion was so widespread that the SEC had suspended trading in ZOOM from March 26, 2020 through April 8, 2020.
• In 2018, nanocap firm Snap Interactive, then with a ticker of "STVI" rebranded as PeerStream to reduce confusion with social media platform Snap ( SNAP ). Snap Interactive had sued Snap for trademark infringement, but the two had settled the matter out of court over a year earlier.
• Back in 2013, some investors confused Twitter, then with the ticker "TWTR", with Tweeter Home Entertainment ( OTC:TWTRQ ).

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