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Economy

JPMorgan takes control of First Republic's $92 BILLION deposits but not company's $100B corporate debt or preferred stock after buying bank

2023-05-02

[Daily Mail, where America gets its news]

Regulators seized the bank on Monday and a deal to sell its assets was struck

San Francisco-based First Republic had total assets of $229.1 billion as of April 13

First Republic Bank has been sold to JPMorgan Chase after regulators seized it on Monday, making it the third major bank to fail in two months.

The California Department of Financial Protection and Innovation (DFPI) said it closed the San Francisco-based bank and agreed on a deal to sell its assets after it had failed to come up with a workable rescue plan.

DFPI appointed the Federal Deposit Insurance Corporation (FDIC) as a receiver, and said it accepted a bid from JPMorgan Chase Bank to assume all deposits.

JPMorgan will take on the majority of assets and other liabilities but will not assume control of First Republic's preferred stock or corporate debt.

The Federal Deposit Insurance Corporation said in a statement: 'To protect depositors, the FDIC is entering into a purchase and assumption agreement with JPMorgan Chase Bank, National Association, Columbus, Ohio, to assume all of the deposits and substantially all of the assets of First Republic Bank.'

Last week, First Republic disclosed that it had lost more than $100 billion in deposits in the first quarter, causing its shares to plummet.

Posted by:Skidmark

#4 I don't mind if a bank gets "enriched" as long as "the little guy" doesn't get screwed in the end (e.g., bail-ins, higher taxes or fees, problems accessing one's account).

Posted by: DooDahMan 2023-05-02 22:39

#3 Sure am glad we have a government that is For the Little Guy and doesn't just enrich the big banks!

Posted by: Tom 2023-05-02 19:24

#2 The bailout will be landing soon. All taxpayers donn crash helmets and prepare to be beat down.

Posted by: Super Hose 2023-05-02 12:29

#1 First Republic's collapse was sparked by 'jumbo mortgages' with interest-only loans at rock bottom rates for the wealthy such as Goldman Sachs' COO and a music exec - who could wait a DECADE before paying back millions

Posted by: Skidmark 2023-05-02 00:45

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