NewsBytes
    Hindi Tamil Telugu
    More
    In the news
    Narendra Modi
    Amit Shah
    Box Office Collection
    Bharatiya Janata Party (BJP)
    OTT releases
    Hindi Tamil Telugu
    NewsBytes
    User Placeholder

    Hi,

    Logout

    India
    Business
    World
    Politics
    Sports
    Technology
    Entertainment
    Auto
    Lifestyle
    Inspirational
    Career
    Bengaluru
    Delhi
    Mumbai

    Download Android App

    Follow us on
    • Facebook
    • Twitter
    • Linkedin
    Home / News / Business News / First Republic Bank's assets seized, JPMorgan to take over
    Next Article
    First Republic Bank's assets seized, JPMorgan to take over
    JPMorgan will acquire FRC's assets worth $229.1 billion

    First Republic Bank's assets seized, JPMorgan to take over

    By Dwaipayan Roy
    May 01, 2023
    05:29 pm

    What's the story

    First Republic Bank (FRC), which was on the brink of collapsing in the aftermath of the Silicon Valley Bank (SVB) crisis, has crashed.

    The silver lining? Its assets have been seized by Federal Deposit Insurance Corporation (FDIC) and the regulator will sell them to JPMorgan Chase & Co.

    FRC is the third major US lender after SVB and Signature Bank, to fall since March.

    Finance

    Let's take a look at the deal

    As per the agreement, JPMorgan will acquire FRC's assets worth around $229.1 billion and deposits of roughly $103.9 billion. FDIC will continue to insure the latter at an estimated cost of $13 billion.

    JPMorgan claims that it will acquire $30 billion of securities and loans valued at $173 billion, including deposits of $92 billion. However, FRC's corporate debt/preferred stock will not be assumed.

    History

    A timeline of the takeover

    Back in March, a consortium of 11 banks including JPMorgan, Morgan Stanley, and Goldman Sachs, deposited $30 billion in FRC, so that it did not crash.

    Soon after, FDIC started accepting bids from financial institutions for FRC's takeover, and the final bids were submitted by JPMorgan and PNC Financial this Sunday.

    JP emerged as the winner and FDIC termed the process "highly competitive."

    Agreement

    JPMorgan is also part of a loss-sharing transaction

    Besides the FRC takeover, JPMorgan has also joined a "loss-share transaction" with FDIC and the U.S. Bank National Association.

    The deal involves "single family, residential, and commercial loans purchased of the former First Republic Bank."

    While FDIC will be the receiver, National Association and JPMorgan shall share potential recoveries on the loans as well as losses. The sum involved with the agreement remains undisclosed.

    Future

    What's next for JPMorgan?

    After acquiring FRC, JPMorgan claimed that it expected to bag a one-time post-tax gain of around $2.6 billion. Meanwhile, FRC's 84 branches across eight US states will be reopened as JPMorgan offices.

    Since 2021, JPMorgan has acquired over 30 companies at a combined valuation of over $5 billion. It is now the biggest US lender and a potential cause of worry for the government.

    Background

    A brief history of First Republic Bank

    Founded in 1985 with just 10 employees, California-based First Republic Bank was an institution that mainly catered to high net-worth individuals.

    Over the years, it had been bought and sold many times, including in 2007, 2009, and in 2010, when it finally went public.

    The 14th largest commercial bank in the US employed over 7,200 people as of the end of last year.

    Facebook
    Whatsapp
    Twitter
    Linkedin
    Related News
    Latest
    JP Morgan
    Banking Regulation Act

    Latest

    Pakistani drones intercepted in Jammu again; blackout in several districts  India
    Carlos Alcaraz returns to form at Rome Masters after injury Carlos Alcaraz
    Michael Vaughan suggests UK as potential venue for IPL 2025 Michael Vaughan
    Arsenal's Mikel Arteta warns fans about potential striker signing challenges Mikel Arteta

    JP Morgan

    JPMorgan to pay $264.4 million in Chinese bribery scandal United States of America
    Deutsche Bank reaches $7.2 billion settlement with US regulators HSBC Bank
    Bengaluru's Phase 1 metro to be inaugurated on June 17 Karnataka
    From corporate to politics: These Indian women are dominating India

    Banking Regulation Act

    3 years of Modi - how has business landscape changed? India
    UIDAI has no jurisdiction over banks: IBA protests directives India
    RBI fines Axis Rs. 3cr, IOB Rs. 2cr for violations Reserve Bank Of India (RBI)
    PMC Bank: SC dismisses petition to end cash withdrawal restrictions Supreme Court Of India
    Indian Premier League (IPL) Celebrity Hollywood Bollywood UEFA Champions League Tennis Football Smartphones Cryptocurrency Upcoming Movies Premier League Cricket News Latest automobiles Latest Cars Upcoming Cars Latest Bikes Upcoming Tablets
    About Us Privacy Policy Terms & Conditions Contact Us Ethical Conduct Grievance Redressal News News Archive Topics Archive Download DevBytes Find Cricket Statistics
    Follow us on
    Facebook Twitter Linkedin
    All rights reserved © NewsBytes 2025