By Svea Herbst-Bayliss and Lawrence Delevingne

NEW YORK/BOSTON (Reuters) - Hedge funds managers and other large investors believe it is far too soon to call an all-clear on turmoil in the global financial sector even after more than a week of financial lifelines, central bank assurances and a massive banking rescue deal.

In the past two weeks, two U.S. banks have collapsed, America's biggest lenders agreed to deposit $30 billion in another ailing firm, (NYSE:), Credit Suisse Group AG needed a lifeline and at the end of a frenetic weekend agreed to be taken over by UBS.

Michael A. Rosen, chief investment officer of Santa Monica-based adviser Angeles Investments, said the UBS-Credit Suisse deal eliminated one potential source of instability, but fundamental problems in the banking system remained, mainly tight monetary policy.

"So maybe one hole in the wall has been plugged, but the water's rising," he said.

One hedge fund manager described trades in the financial sector as being "all over the map", with nobody agreeing on anything.

Some breathed a sigh of relief that a competitor stepped in with a rescue offer for Credit Suisse. Others worried that the $3.2 billion UBS will pay is far less than the $9.5 billion Credit Suisse was valued at on Friday, and one investor said the market may not consider this to be a positive.

Many of the roughly one dozen managers contacted on Sunday asked not to be identified because their firms prohibit them from discussing their trades with the media, or they did not want to make their views and positions public.

Others tweeted throughout the day.

Daniel Loeb, chief investment officer of U.S. hedge fund firm Third Point LLC, wrote on Sunday morning that initial news of the UBS offer for Credit Suisse would be "positive for financial system as it preserves the capital structure."

Later, short seller Jim Chanos tweeted his shock that $17 billion of Credit Suisse bonds would be wiped out, asking "What are the Swiss doing here…?!"

Chanos and Loeb did not respond to emails seeking further comment.

There was also little agreement on how investors would be positioning themselves in smaller U.S. banks, including First Republic.

First Republic's stock price tumbled 33% on Friday, one day after a handful of the country's largest banks, including JPMorgan Chase (NYSE:), organized a $30 billion rescue package that was supported by the Federal Reserve and U.S. Treasury.

On Sunday, credit rating agency S&P Global (NYSE:) downgraded First Republic's ratings for the second time in less than a week, lowering its sovereign credit ratings to "B+" from "BB+". S&P maintained its outlook at "Creditwatch Negative."

"The situation is not resolving easily," said one investor who allocates wealthy clients' capital with hedge funds.

Several fund managers said it felt dangerous to bet on further declines in light of the rescue package, noting that retail investors could band together and support banks like First Republic that were seen as solid enterprises. "This name could easily go meme stock, so there is a fear of being short here," one manager said.

Investors' short interest in First Republic was at $190 million, or about 3% of its float, according to data tweeted on Friday by research firm S3 Partners, which said short-sellers had made mark-to-market profits of $537 million on the trade this year and $62 million on Friday alone.

Several investors also said they expect federal regulators to impose new rules for regional banks by tightening lending standards or forcing them to raise capital. With more regulatory pressure ahead, some said that buying stock in these banks after steep price declines might be a tougher call, because their lending activity could shrink.

Investor Ricky Sandler, who runs hedge fund Eminence Capital LP, speculated on Twitter on Friday that an investment bank might be interested in First Republic, which caters to wealthy clients.

Sandler did not respond to a request for additional comment on Sunday. A First Republic spokesman said the bank "is well positioned to manage short-term deposit activity," given last week's deposit infusion, as well as cash on hand.

The KBW Bank Index, a proxy for banks, tumbled 11.12% last week, signaling that further turmoil could lie ahead.

Some investors, including a large mutual fund group that also runs a hedge fund, said prospects for banks had gotten progressively worse in recent months given the economic outlook.

"As we thought the country would drop into recession last year, we curbed our banking exposure," said a senior executive at that group. "That feels like a good call right now."