Regulators seized troubled First Republic Bank Monday, May 1, 2023, and sold its deposits and most of its assets to JPMorgan Chase Bank. This was to avoid further banking turmoil in the US. With $229 billion in assets, the First Republic Bank failure became the second-largest in US history. It surpasses Silicon Valley Bank, which failed on March 10, 2023, with $209 billion in assets. Here are the facts.
1. First Republic Bank: 14th-Largest US Bank
At the beginning of 2023, First Republic Bank ranked as the 14th-largest bank in the United States, boasting approximately $229 billion in total assets and $104 billion in total deposits.
2. Uninsured Deposits and Low-Interest Rate Exposure
The bank had a significant amount of uninsured deposits (exceeding the $250,000 limit set by the FDIC) and considerable exposure to low-interest-rate loans.
3. Struggles Following Silicon Valley Bank and Signature Bank Collapses
First Republic Bank faced difficulties since the March collapses of Silicon Valley Bank and Signature Bank, which alarmed depositors and investors alike.
4. $30 Billion Lifeline from Major US Banks
In March 2023, First Republic Bank received a crucial $30 billion lifeline from 11 of the country’s largest banks.
5. Over $100 Billion in Deposits Withdrawn
The bank disclosed that customers had withdrawn over $100 billion in deposits during the first three months of 2023.
6. Regulators Seize First Republic Bank, Assets Sold to JPMorgan Chase
Early Monday, May 1, 2023, regulators seized the First Republic Bank and sold its deposits and most of its assets to JPMorgan Chase Bank, the nation’s largest bank. The bank has a reputation as a dealmaker during times of crisis. It has previously acquired failed banks such as Silicon Valley Bank in March 2023 and Washington Mutual and Bear Stearns during the 2008 financial crisis.
7. FDIC Deposit Insurance Fund Takes a $13 Billion Hit
The FDIC estimated that its deposit insurance fund would suffer a $13 billion blow from taking First Republic Bank into receivership.
8. First Republic Bank Branches to Reopen as JPMorgan Chase Locations
First Republic Bank’s 84 branches across eight states will reopen as branches of JPMorgan Chase Bank.
As always, we cross-checked our facts with the most trusted news providers. Here are some articles we read about the First Republic Bank failure:
- AP News: First Republic Bank failure: Seized, sold to JPMorgan Chase
- AP News: Is my money safe? What you need to know about bank failures
- The New York Times: First Republic, Silicon Valley Bank, and Signature: How Banking Failures Compare
- Reuters: JPMorgan Snaps up First Republic’s Assets in US Auction
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