JPMorgan Chase acquires US bank First Republic

The New York-based bank will pay $10.6bn (£8.5bn) to First Republic receiver the Federal Insurance Deposit Corporation (FIDC) after First Republic was shut down by the California Department of Financial Protection and Innovation.

As part of the transaction, First Republic’s 84 offices will reopen as branches of JPMorgan Chase Bank, with all depositors of First Republic Bank becoming depositors of JPMorgan Chase Bank.  

Additionally, JPMorgan Chase has acquired most of First Republic Bank’s assets – including approximately $173bn (£138.1bn) of loans and $30bn (£24bn) of securities, as well as the assumption of $92bn (£73.8bn) worth of deposits – including $30bn (£24bn) of large bank deposits.  

In response, JPMorgan Chase chief executive and chairman Jamie Dimon said: “Our government invited us and others to step up, and we did. 

 
“Our financial strength, capabilities and business model allowed us to develop a bid to execute the transaction in a way to minimise costs to the Deposit Insurance Fund. This acquisition modestly benefits our company overall, it is accretive to shareholders, it helps further advance our wealth strategy, and it is complementary to our existing franchise.” 

First Republic had been placed under pressure last month following the collapse of Silicon Valley Bank and Signature Bank, sparking fears about the state of the banking system. Authorities said they hoped the deal would resolve the panic.