JPMorgan Chase is taking over First Republic Bank, the nation's 14th-largest bank, after its collapse. The banking giant will assume most of First Republic's assets and all of its deposits.
JPMorgan made a bid to purchase First Republic immediately after federal regulators seized the crumbling bank early Monday morning. The Federal Deposit Insurance Corporation (FDIC) then accepted the bid. The transaction happened before stock market open on Monday.
First Republic Bank’s 84 offices in eight states will reopen as branches of JPMorgan Chase Bank during business hours Monday, the FDIC said in a press release.
Anyone with deposits at First Republic are now customers of JPMorgan Chase.
JPMorgan will take on $173 billion of loans, $30 billion of securities and $92 billion of deposits of the failed lender, reports say.
First Republic Bank has been struggling in recent months, losing 97% of its value this year. This marks the third bank rescue in the past few months, following the collapses of Silicon Valley Bank and then Signature Bank. The Federal Reserve had to take emergency measures to keep markets from taking too much of a hit.
What led to the collapse of Silicon Valley Bank and others?
Like any other bank, it operated by taking a portion of deposits and creating loans — but this only works if there's enough deposited at once.
