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The Cleveland-based bank says it will submit to a racial equity audit conducted by an outside law firm, as Citigroup and Wells Fargo have previously done. The bank's decision follows a request that regulators investigate Key's mortgage lending practices for alleged redlining.

Industry leaders had predicted that JPMorgan Chase's regulator-assisted purchase of First Republic would bolster investors' faith in the sector. But the stock prices of certain regional banks have continued to fall, prompting concerns that selloffs could lead to deposit outflows.

Emergency borrowing from the Federal Reserve plunged last week, partly reflecting the seizure of First Republic Bank, which accounted for a large share of outstanding loans.

The Federal Reserve flagged multiple "deficiencies" at Du Quoin State Bank in an order that bars the Illinois depository from paying dividends without its regulators' approval. The central bank has identified interest rate risk as a key issue at a time when rising rates have contributed to three bank failures.

Blue-chip issuers largely avoided tapping the market on Thursday, while a key measure of credit risk soared to the highest since the failures of SVB Financial Group and Signature Bank in March.

Former First Republic CEO Mike Roffler told regulators earlier this year that the bank could fail according to its resolution plan, but the institution still needed extra help to stay afloat long enough to organize a sale without further harming the financial system.

Liberty Bank, an $11.6 million-asset lender in Salt Lake City, is the first FDIC-supervised bank in six years to be hit with the lowest Community Reinvestment Act rating possible twice in a row. Regulators identified an unspecified "illegal credit practice" during their review of the bank's performance.

Merger arbitrage traders were expecting hiccups in Toronto-Dominion Bank's proposed takeover of First Horizon, but they were unprepared for its cancellation.

For firms that get it right, there's a chance to capture profits and offset risk from rising interest rates and inflation, according to experts who spoke at our Payments Forum conference.

A potential pause in the cycle by the Federal Open Market Committee is welcomed by housing industry observers, but inflation and inventory hinder activity.