Connect with us
Active Currencies 14794
Market Cap $2,467,692,571,200.00
Bitcoin Share 51.25%
24h Market Cap Change $-0.87

JPMorgan Chase to acquire First Republic Bank for this amount, details inside

2min Read

The Federal Deposit Insurance Corporations’ Deposit Insurance Fund will take a$13 billion haircut to continue insuring all the deposits of First Republic that will be converted to JPMorgan deposits.

JPMorgan Chase to acquire First Republic Bank for this amount, details inside

Share this article

  • The Federal Deposit Insurance Corp has named JPMorgan Chase as the buyer of First Republic Bank.
  • JPMorgan will take over $229 billion in assets and $103 billion in total deposits from the troubled bank.

The U.S. Federal Deposit Insurance Corporation (FDIC) has named American banking giant JPMorgan Chase as the buyer of First Republic Bank. The troubled bank was closed by the California Department of Financial Protection and Innovation on May 1 after efforts to rescue the bank failed. 

JPMorgan Chase to take over $330 billion in assets

According to a press release from the FDIC, California’s financial regulator closed First Republic and appointed the federal agency as the bank’s receiver. The FDIC has entered into a purchase and assumption agreement with JPMorgan Chase Bank. The latter will assume all the troubled financial institution’s deposits and the majority of its assets as well.

As per the bid submitted by JPMorgan for acquiring the assets of First Republic Bank, the latter’s 84 offices in eight states across the country will reopen as branches of JPMorgan on 1 May. The FDIC stated that all depositors of First Republic will be converted into depositors of JPMorgan. Moreover, they will have full access to their deposits. 

The FDIC clarified that it will clarify all deposits after transactions are concluded. JPMorgan will take over a whopping $229.1 billion in assets and $103 billion in total deposits from First Republic Bank. In addition to assuming all the struggling bank’s deposits, JPMorgan has agreed to purchase substantially all of its assets. The bank was named as First Republic’s buyer after a highly competitive bidding process, which was judged on the basis of the least-cost requirements of the Federal Deposit Insurance Act. First Republic’s resolution will cost an estimated $13 billion to FDIC’s Deposit Insurance Fund. 

In addition to the transfer of assets and deposits, JPMorgan also entered into a loss-sharing transaction for the residential and commercial loans it had acquired from First Republic. As per this agreement, the bank will share the losses and potential recoveries on said loans with the FDIC. Furthermore, all of First Republic’s Qualified Financial Contracts will be assumed by JPMorgan.  

Share

Saman Waris works as a News Editor at AMBCrypto. She has always been fascinated by how the tides of finance and technology shape communities across demographics. Cryptocurrencies are of particular interest to Saman, with much of her writing centered around understanding how ideas like Momentum and Greater Fool theories apply to altcoins, specifically, memecoins. A graduate in history, Saman worked the sports beat before diving into crypto. Prior to joining AMBCrypto 2 years ago, Saman was a News Editor at Sportskeeda. This was preceded by her stint as Editor-in-Chief at EssentiallySports.
Read the best crypto stories of the day in less than 5 minutes
Subscribe to get it daily in your inbox.
Please check the format of your first name and/or email address.

Thank you for subscribing to Unhashed.