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☆ JPMorgan just got a lot bigger — and Elizabeth Warren is alarmed
▼ + stars: | 2023-05-02 | by ( Matt Egan | ) edition.cnn.com time to read: +4 min

Washington, DC CNN —JPMorgan Chase has once again come to the rescue of the banking system by acquiring a doomed bank. By blessing JPMorgan’s takeover of First Republic Bank, Warren fears federal regulators just made the” Too Big to Fail” problem even worse. My view on this is it’s important to look at the effect on competition and to try to keep a more diversified banking system,” Warren said. For his part, JPMorgan CEO Jamie Dimon is hopeful his bank’s takeover of First Republic eases the stress in the banking system. Clawing back banker payIn the wake of the bank failures, Warren is calling for accountability — both of bank executives and regulators.

☆ 'Other problems might be lurking': Strategist is unconvinced by Jamie Dimon's bank crisis comments
▼ + stars: | 2023-05-02 | by ( Elliot Smith | ) www.cnbc.com time to read: +3 min

Workers are seen inside of a First Republic Bank office on May 01, 2023 in San Francisco, California. Justin Sullivan | Getty Imageswatch nowDavid Pierce, director of strategic initiatives at Utah-based GPS Capital Markets, told CNBC Tuesday that the financial sector's frailties may be more profound than the messaging from bankers and policymakers suggests. Could they have funded them and given them additional capital, provided loans that would have gotten them through this hard time?" The World Economic Forum's Chief Economists Outlook, published Monday, showed chief economists by and large do not currently see large-scale systemic risk from the recent banking chaos, but they do think it will have some economic impact. "Although the chief economists are broadly sanguine about the systemic implications of the recent financial disruption – 69% characterize it as isolated episodes rather than signs of systemic vulnerability – they point to potentially damaging knock-on effects," the report said.

The deal talks went down to the wire, according to two sources familiar with the situation. Four bidders, including JPMorgan, made it to the final rounds of the auction on Sunday night, one of the sources said. The final deal, announced around 3:30 a.m., cements Dimon's reputation as one of Wall Street's most powerful bankers. JPMorgan started a process internally, which looked at various options for First Republic, including an acquisition, according to a source familiar with the matter. The auction dragged out through the night as the FDIC's advisors examined each bid on its merits, a source familiar with the matter said.

☆ Sheila Bair to Jerome Powell: Stop trying to look so tough on inflation. It will backfire
▼ + stars: | 2023-05-02 | by ( Matt Egan | ) edition.cnn.com time to read: +4 min

The Fed’s war on inflation has piled pressure on the banking system, contributing to the significant stress on the banking system. “I would say hit pause,” Bair told CNN in a phone interview on Monday. I know they want to look tough, but at some point, they look weak,” Bair said. Bair argues the Fed needs “more thought” about the impact these monetary policy decisions are having on the stability of the banking system. “It sounds scary but in the context of the entire banking system, it’s not huge.

Shares of JPMorgan and some of the other the largest U.S. banks rose on Monday, while those of mid-tier banks fell. [1/3] People walk past a First Republic Bank branch in San Francisco, California, U.S. April 28, 2023. "This is not the world financial crisis, this is not the savings and loan crisis. JPMorgan also entered into a loss-share agreement with the FDIC on single family, residential and commercial loans it bought, but will not take First Republic Bank's corporate debt or preferred stock. The failed bank's 84 offices in eight states will reopen as branches of JPMorgan Chase Bank from Monday, it added.

First Republic was one of the major casualties of the banking crisis triggered in March, when depositors fled en masse from some U.S. lenders to institutions such as JPMorgan that they thought were safer. [1/2] People walk past a First Republic Bank branch in San Francisco, California, U.S. April 28, 2023. JPMorgan has assumed all of the bank's deposits, it said, and will repay $25 billion of the $30 billion big banks deposited with First Republic in March. JPMorgan said it expected to achieve a one-time, post-tax gain of about $2.6 billion after the deal. The failed bank's 84 offices in eight states will reopen as branches of JPMorgan Chase Bank from Monday, it added.

☆ 2 JPMorgan buys First Republic Bank's assets
▼ + stars: | 2023-05-01 | by ( ) www.reuters.com time to read: +6 min

May 1 (Reuters) - JPMorgan Chase & Co (JPM.N), the biggest U.S. bank by assets, said on Monday it will buy most of First Republic Bank's (FRC.N) assets after U.S. regulators seized the troubled bank. low single digits), strategically consistent (US wealth expansion), and system friendly - FDIC loss of only $13B (<est. "First, as with the GFC (Global Financial Crisis,) this once again shows the value of a fortress balance sheet. "Assets such as the U.S. dollar and Japanese yen will be on the radar as traders look for an asset of safety. Still, unlike Silicon Valley Bank and Signature Bank, the FDIC had a buy waiting in the wings.

FDIC Chair Martin Gruenberg has said the report, to be released at 2:00 p.m. EDT (1800 GMT) on Monday, will address options on deposit insurance coverage levels, excess deposit insurance, implications of risk-based pricing and the adequacy of the regulator's deposit insurance fund, which will take an estimated $20 billion hit from the failure of SVB and a smaller knock of about $2.5 billion from Signature Bank. The FDIC's deposit insurance fund helps to fulfill the agency's guarantee of bank deposits up to $250,000 per person. In the event an insured bank fails, the FDIC uses the deposit insurance fund to pay back customers who maintained accounts under the limit. U.S. Federal Reserve Chair Jerome Powell told Republican lawmakers in March that Congress should re-evaluate limits on the size of federally insured bank deposits. Some analysts have floated a more targeted change: raising the insurance cap for small business accounts used to manage payroll and other transactions.

☆ JPMorgan buys First Republic Bank's assets
▼ + stars: | 2023-05-01 | by ( ) www.reuters.com time to read: +4 min

May 1 (Reuters) - JPMorgan Chase & Co (JPM.N), the biggest U.S. bank by assets, said on Monday it will buy most of First Republic Bank's (FRC.N) assets after U.S. regulators seized the troubled bank. The collapse marks the third major U.S. lender to fail in less than two months, after a week of panic which saw First Republic lose 75% of its market value as its future turned murkier. "Assets such as the U.S. dollar and Japanese yen will be on the radar as traders look for an asset of safety. "This development will most likely not prevent the Fed from raising U.S. interest rates this week as largely expected. Still, unlike Silicon Valley Bank and Signature Bank, the FDIC had a buy waiting in the wings.

STEPPING UPA security guard stands outside a First Republic Bank branch in San Francisco, California, U.S. April 28, 2023. The FDIC estimated in a statement that the cost to the Deposit Insurance Fund (DIF) would be about $13 billion. JPMorgan has assumed all of the bank's deposits, it said, and will repay $25 billion of the $30 billion big banks deposited with First Republic in March. New York-based JPMorgan will take on $173 billion of loans, $30 billion of securities and $92 billion of deposits. "Our government invited us and others to step up, and we did," said Jamie Dimon, JPMorgan Chairman and CEO.

☆ U.S. Treasury encouraged by First Republic resolution, says banking system remains sound
▼ + stars: | 2023-05-01 | by ( ) www.reuters.com time to read: +2 min

WASHINGTON, May 1 (Reuters) - The U.S. Treasury Department is encouraged that First Republic Bank (FRC.N) was resolved with the least cost to the Deposit Insurance Fund, and believes the U.S. banking system remains sound and resilient, a Treasury spokesperson said early Monday. "Treasury is encouraged that this institution was resolved with the least cost to the Deposit Insurance Fund, and in a manner that protected all depositors," the spokesperson said. "The banking system remains sound and resilient, and Americans should feel confident in the safety of their deposits and the ability of the banking system to fulfill its essential function of providing credit to businesses and families." The California Department of Financial Protection and Innovation said it had taken possession of First Republic and the Federal Deposit Insurance Corporation (FDIC) would act as its receiver. The FDIC estimated in a statement that the cost to the Deposit Insurance Fund would be about $13 billion.

May 1 (Reuters) - JPMorgan Chase & Co (JPM.N) will buy most of First Republic Bank's (FRC.N) assets in a last-ditch rescue led by U.S. regulators, marking the third major U.S. institution to fail in two months. First Republic Bank shares tumbled 43.3% in premarket trading. The FDIC estimated in a statement that the cost to the Deposit Insurance Fund would be about $13 billion. "Our government invited us and others to step up, and we did," said Jamie Dimon, Chairman and CEO of JPMorgan Chase. The failed bank's 84 offices in eight states will reopen as branches of JPMorgan Chase Bank from Monday, according to the JPMorgan statement.

☆ JP Morgan to buy First Republic's assets and assume deposits
▼ + stars: | 2023-05-01 | by ( ) www.reuters.com time to read: +3 min

The banking giant will take $173 billion of loans and about $30 billion of securities of First Republic Bank including $92 billion of deposits, JPMorgan said in a statement. First Republic Bank shares tumbled 36% in premarket trading. The FDIC estimated in a statement that the cost to the Deposit Insurance Fund would be about $13 billion. "Our government invited us and others to step up, and we did," said Jamie Dimon, Chairman and CEO of JPMorgan Chase. The failed bank's 84 offices in eight states will reopen as branches of JPMorgan Chase Bank from Monday, according to the JPMorgan statement.

☆ First Republic Is Sold: What to Know
▼ + stars: | 2023-05-01 | by ( Lora Kelley | ) www.nytimes.com time to read: +1 min

The federal government seized First Republic Bank and sold it JPMorgan Chase on Monday, ending the lender’s six-week-long free fall and reassuring depositors that their money is safe. Widely viewed as the most at-risk bank since Silicon Valley Bank and Signature Bank failed in March, First Republic lost $102 billion in deposits last quarter (more than half the $176 billion it held at the end of last year). Over that period, the bank also borrowed some $92 billion, mostly from government-backed lending groups and the Federal Reserve. First Republic Bank’s failure had much the same roots as the collapses of Silicon Valley Bank and Signature Bank — spooked depositors and investors pulling their money and selling their shares in droves. JPMorgan will “assume all of the deposits and substantially all of the assets of First Republic Bank,” the Federal Deposit Insurance Corporation said it an statement, adding that its insurance fund would have to pay out an estimated $13 billion to cover First Republic’s losses.

☆ FDIC sees merits of increasing backstop for business accounts
▼ + stars: | 2023-05-01 | by ( ) www.cnbc.com time to read: +3 min

A key U.S. banking regulator on Monday laid out a range of options for reforming the federal deposit insurance system and concluded that significantly increasing the backstop for bank accounts used for business purposes was the "most promising." In the wake of March's lightning-fast bank failures, expanding coverage for accounts used to cover payroll, invoices and other large business transactions has emerged as the Federal Deposit Insurance Corp's preferred route for balancing financial stability and depositor protection, relative to its cost. Keeping the current system, where coverage is limited to $250,000 per-person per-bank, was the third option considered. The FDIC's deposit insurance fund helps to fulfill the agency's guarantee of bank deposits up to $250,000 per person. In the event an insured bank fails, the FDIC uses the deposit insurance fund to pay back customers who maintained accounts under the limit.

☆ JPMorgan takes over First Republic after it's seized by Californian financial regulator
▼ + stars: | 2023-05-01 | by ( Hugh Son | ) www.cnbc.com time to read: +1 min

A view of the First Republic Bank logo at the Park Avenue location, in New York City, March 10, 2023. The Californian financial regulator took possession of First Republic Monday, resulting in the third failure of an American bank since March, after a last-ditch effort to persuade rival lenders to keep the ailing bank afloat failed. JPMorgan Chase acquired all of First Republic's deposits, including uninsured deposits, and a "substantial majority of assets," according to a release. "As part of the transaction, First Republic Bank's 84 offices in eight states will reopen as branches of JPMorgan Chase Bank, National Association, today during normal business hours," the FDIC said in a statement. "All depositors of First Republic Bank will become depositors of JPMorgan Chase Bank, National Association, and will have full access to all of their deposits."

☆ JPMorgan is buying First Republic Bank after it was taken over by regulators
▼ + stars: | 2023-05-01 | by ( Kaja Whitehouse | Huileng Tan | ) www.businessinsider.com time to read: +5 min

First Republic Bank was put into receivership by regulators early Monday. First Republic Bank will be taken over by JPMorgan after being seized by regulators, marking the third regional bank to be taken over by federal regulators following a consumer panic that took down Silicon Valley Bank in March. The FDIC said early Monday that JPMorgan submitted a bid for all of First Republic's deposits of $103.9 billion. As part of the transaction, First Republic Bank's 84 offices in eight states will reopen as branches of JPMorgan on Monday. JPMorgan is assuming all of First Republic Bank's deposits — including uninsured ones — as well as most of its assets, said FDIC and JPMorgan in their statements.

☆ Jamie Dimon says JPMorgan rescued First Republic because the government asked his bank 'to step up, and we did'
▼ + stars: | 2023-05-01 | by ( Ryan Hogg | ) www.businessinsider.com time to read: +3 min

Jamie Dimon says JPMorgan bought First Republic after the US government asked it to "step up." Jamie Dimon said JPMorgan's acquisition of First Republic came after the US government asked the bank to "step up" in a deal that will "modestly" benefit America's biggest bank. "Our government invited us and others to step up, and we did," JPMorgan CEO Dimon said in a press release. In addition to most of First Republic's deposits, JPMorgan will pick up about $173 billion in loans and about $30 million of securities. First Republic's shares slumped more than 40% to $2.10 in pre-market trading, while JPMorgan rose 2.5% to $141.70.

☆ Why First Republic Bank may not be the end of the crisis
▼ + stars: | 2023-05-01 | by ( Allison Morrow | ) edition.cnn.com time to read: +5 min

New York CNN —After a six-week spiral, First Republic bank finally collapsed in the wee hours of Monday morning. Everyone on Wall Street appears to be drinking from the same punch bowl as Jamie Dimon, who framed the sale as a bookend to the crisis. To his mind, the sale just makes JPMorgan, already the nation’s largest bank, even bigger, and the power of the biggest Wall Street banks more concentrated. That idea got an extra boost on Monday, when the FDIC itself released a report advocating for an increase in the deposit insurance limit for business payment accounts. “You can think of federal deposit insurance as being a bit like nuclear weapons,” he said.

☆ FDIC asks JPMorgan, PNC for final First Republic bids, media reports say
▼ + stars: | 2023-04-29 | by ( ) www.reuters.com time to read: +1 min

Bank of America (BAC.N) is among several other institutions weighing a potential bid for First Republic, CNBC reported on Saturday, citing people with knowledge of the matter. Based on those submissions on Friday, the FDIC invited at least two companies to the next step in the bidding, the Bloomberg report added, citing people familiar with the matter. The FDIC said in an email: "We would not comment on or confirm whether we are bidding an open institution." PNC Financial declined to comment on the Bloomberg report. JPMorgan and Bank of America did not immediately respond to a voicemail and email seeking comment.

☆ FDIC prepares to place First Republic under receivership
▼ + stars: | 2023-04-29 | by ( Greg Roumeliotis | ) www.reuters.com time to read: +4 min

April 28 (Reuters) - The U.S. Federal Deposit Insurance Corporation (FDIC) is preparing to place First Republic Bank (FRC.N) under receivership imminently, a person familiar with the matter said on Friday, sending shares of the lender down nearly 50% in extended trading. The FDIC asked banks including JPMorgan Chase & Co (JPM.N) and PNC Financial Services Group (PNC.N) to submit final bids for First Republic Bank by Sunday, Bloomberg News reported on Saturday. If the San Francisco-based lender falls into receivership, it would be the third U.S. bank to collapse since March. Shares of some other regional banks also fell, with PacWest Bancorp (PACW.O) down 2% after the bell while Western Alliance (WAL.N) was down 0.7%. "The rest of the regional bank system feels like it's in a different place than where FRC is," he said.

☆ US FDIC asks JPMorgan, PNC for final First Republic bids due Sunday - Bloomberg News
▼ + stars: | 2023-04-29 | by ( Reuters Staff | ) www.reuters.com time to read: +1 min

People walk past a First Republic Bank branch in San Francisco, California, U.S. April 28, 2023. REUTERS/Loren Elliott(Reuters) - The U.S. Federal Deposit Insurance Corp has asked banks including JPMorgan Chase & Co and PNC Financial Services Group to submit final bids for First Republic Bank by Sunday after gauging their initial interest earlier in the week, Bloomberg News reported on Saturday. The banking regulator reached out to banks late Thursday seeking indications of interest, including a proposed price and estimated cost to the agency’s deposit insurance fund, the report said. Based on those submissions on Friday, FDIC invited at least two firms to the next step in the bidding, the report added, citing people familiar with the matter. If the San Francisco-based lender falls into receivership, it would be the third U.S. bank to collapse since March, after the collapse of Silicon Valley Bank and Signature Bank.

☆ FDIC asks JPMorgan, PNC for final First Republic bids: Bloomberg
▼ + stars: | 2023-04-29 | by ( ) www.reuters.com time to read: +1 min

April 29 (Reuters) - The U.S. Federal Deposit Insurance Corp has asked banks including JPMorgan Chase & Co (JPM.N) and PNC Financial Services Group (PNC.N) to submit final bids for First Republic Bank (FRC.N) by Sunday after gauging their initial interest earlier in the week, Bloomberg News reported on Saturday. Based on those submissions on Friday, FDIC invited at least two firms to the next step in the bidding, the report added, citing people familiar with the matter. PNC Financial and a FDIC spokesperson declined to comment on the Bloomberg report. JPMorgan did not immediately respond to voicemails and emails seeking comment. Reporting by Jyoti Narayan in Bengaluru Editing by Alexandra HudsonOur Standards: The Thomson Reuters Trust Principles.

☆ Big banks including JPMorgan Chase, Bank of America asked for final bids on First Republic
▼ + stars: | 2023-04-29 | by ( Hugh Son | ) www.cnbc.com time to read: +5 min

JPMorgan Chase and PNC are likely bidders for the ailing lender, which would be seized in receivership and immediately sold to the winning bank, according to people with knowledge of the situation. Bank of America is among several other institutions that are weighing a potential bid for First Republic, according to people with knowledge of the matter. Shares of the bank sank 90% last month, and then collapsed further this week after First Republic disclosed how dire its situation is. The biggest banks will bear the brunt of that expense, because member banks will likely be assessed fees to replenish the FDIC fund over several years. Wells Fargo , Goldman Sachs and Citigroup are each unlikely to make a bid, according to people with knowledge of the banks.

☆ Signature Bank failure due to 'poor management,' US FDIC report says
▼ + stars: | 2023-04-28 | by ( ) www.reuters.com time to read: +4 min

April 28 (Reuters) - Last month's failure of New York-based Signature Bank was caused by "poor management" and a pursuit of "rapid, unrestrained growth" with little regard for risk management, the Federal Deposit Insurance Corporation said on Friday in a report detailing its supervision and regulation of the regional bank. Bank management and its board chased growth and deposits without "developing and maintaining adequate risk management practices and controls appropriate for the size, complexity and risk profile of the institution," according to the 63-page report. The same day SVB failed, Signature lost 20% of its total deposits in a matter of hours, FDIC Chair Martin Gruenberg has said. Similar to SVB, Signature examiners reported weak corporate governance practices and failures by bank management to address shortcomings identified by supervisors, including the firm's reliance on uninsured deposits. Like SVB, Signature relied heavily on uninsured deposits and experienced a boom in growth between 2019 and 2020, when its assets grew 64%, according to Gruenberg.

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