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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.

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