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☆ 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.

☆ What the First Republic takeover means for customers
▼ + stars: | 2023-05-01 | by ( Jeanne Sahadi | ) edition.cnn.com time to read: +3 min

New York CNN —First Republic Bank was taken over by the Federal Deposit Insurance Corporation on Monday, with most of its assets sold to JPMorgan Chase. Chase is assuming all deposits of First Republic customers. First Republic customers’ deposits will continue to be FDIC-insured. First Republic customers will have many of the same banking conveniences that they had before the bank was taken over. Direct deposits like paychecks and Social Security benefits will continue as usual,” the FDIC said on its resource page for First Republic customers.

NEW YORK, May 1 (Reuters) - Fifth Third Bancorp (FITB.O) was one the banks that submitted final bids for First Republic Bank (FRC.N) on Sunday before it was sold to JPMorgan Chase & Co (JPM.N), people familiar with the matter said. PNC Financial Services Group (PNC.N) and Citizens Financial Group Inc (CFG.N) were the other final-round bidders for First Republic, Reuters has previously reported. Earlier on Monday, JPMorgan emerged as the winner of a weekend auction of First Republic Bank, in a deal that followed the troubled lender being taken over by the Federal Deposit Insurance Corporation (FDIC). Fifth Third and the FDIC did not immediately respond to a request for comment. Reporting by Anirban Sen and David French in New York Additional reporting by Saeed Azhar in New York and Peter Schroeder in Washington, D.C.

☆ 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.

☆ Lawmakers praise First Republic sale, but efforts to pass new bank rules are fizzling
▼ + stars: | 2023-05-01 | by ( Christina Wilkie | In | ) www.cnbc.com time to read: +3 min

WASHINGTON — Lawmakers who sit atop key banking committees praised the federal takeover of First Republic Bank on Monday, and held up the sale of its assets to JP Morgan Chase as a successful public-private collaboration to protect the U.S. financial system. His statement contrasted from the reaction of the Senate banking committee's chairman, Democratic Sen. Sherrod Brown of Ohio. He did not directly respond to the federal intervention, choosing instead to direct his ire at the failed bank. "First Republic Bank's risky behavior, unique business model, and management failures led to significant problems, and it's clear we need stronger guardrails in place," Brown said in a statement. "We must make large banks more resilient against failure so that we protect financial stability and ensure competition in the long run."

New York CNN —The collapse of First Republic Bank is unlikely to worsen the US economic outlook, JPMorgan CEO Jamie Dimon said Monday. Dimon told CNN’s Poppy Harlow early last month that the stress in the banking system had increased the odds of a US recession. The bank had $100 billion in those deposits withdrawn from the bank during the first quarter, it reported last week. “The American banking system is extraordinarily sound,” he said. But he agreed with Dimon that the seizure of First Republic, however, does not shift those forecasts, he told CNN Monday.

☆ First Republic deal boosts our banks. Danaher gets a confidence vote. Here are our takes on the news
▼ + stars: | 2023-05-01 | by ( Kevin Stankiewicz | ) www.cnbc.com time to read: +6 min

That deposit money will be repaid to the participating banks, which include Club holdings Wells Fargo (WFC) and Morgan Stanley (MS). Wells Fargo deposited $5 billion , while Morgan Stanley contributed $2.5 billion. The Club's take: Morgan Stanley and Wells Fargo are stocks worth buying here, Jim Cramer said during Monday's "Morning Meeting." One potential drag on Morgan Stanley shares is JPMorgan's wealth management operations are strengthened by its First Republic acquisition. A man walks past a First Republic bank in Manhattan on May 01, 2023 in New York City.

☆ FDIC calls for higher deposit insurance cap after bank failures
▼ + stars: | 2023-05-01 | by ( Elisabeth Buchwald | ) edition.cnn.com time to read: +2 min

New York CNN —The Federal Deposit Insurance Corporation is advocating for an increase in the deposit insurance limit for business payment accounts following the three recent bank failures. It also provided temporary unlimited deposit insurance to non-interest bearing accounts in the wake of the Great Recession. The agency’s proposal, outlined in a report it released Monday, did not specify what it thinks would be an appropriate increased level of deposit insurance for business payment accounts. The FDIC considered two other deposit insurance reforms: raising the insurance cap across all bank accounts, and extending unlimited deposit insurance to all accounts. Increasing the insurance cap on business payment accounts would likely result in increasing the premiums that banks pay to the FDIC.

☆ Jamie Dimon says 'this part of the crisis is over' after JPMorgan Chase buys First Republic
▼ + stars: | 2023-05-01 | by ( Hugh Son | ) www.cnbc.com time to read: +2 min

Jamie Dimon, chairman and chief executive officer of JPMorgan Chase & Co., during a Bloomberg Television interview at the JPMorgan Global High Yield and Leveraged Finance Conference in Miami, Florida, US, on Monday, March 6, 2023. The crisis that led to the downfall of three regional U.S. banks in recent weeks is largely over after the resolution of First Republic , according to JPMorgan Chase CEO Jamie Dimon. JPMorgan emerged as the winner of a weekend auction for First Republic after regulators decided that time had run out on a private sector solution. In the wake of the sudden collapse in March of Silicon Valley Bank and Signature Bank, investors have punished other lenders that had similar characteristics to SVB. Shares of regional banks including PacWest and Citizens Financial slumped in premarket trading.

New York/London CNN —JPMorgan Chase is buying most assets of First Republic Bank and assuming all of the lender’s deposits in a deal announced Monday that was arranged by the US Federal Deposit Insurance Corporation. JPMorgan said it had acquired “the substantial majority of assets” and assumed the deposits, insured and uninsured, of First Republic Bank from the FDIC, the independent government agency that insures deposits for bank customers. The FDIC took control of the embattled First Republic and then immediately announced a sale of many of its assets and deposits. Silicon Valley Bank and Signature Bank both were taken over by the FDIC last month following runs on those banks by their customers. “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,” it noted.

Lawmakers and regulators have spent years erecting laws and rules meant to limit the power and size of the largest U.S. banks. But those efforts were cast aside in a frantic late-night effort by government officials to contain a banking crisis by seizing and selling First Republic Bank to the country’s biggest bank, JPMorgan Chase. The F.D.I.C.’s decision appears, for now, to have quelled nearly two months of simmering turmoil in the banking sector that followed the sudden collapse of Silicon Valley Bank and Signature Bank in early March. “This part of the crisis is over,” Jamie Dimon, JPMorgan’s chief executive, told analysts on Monday in a conference call to discuss the acquisition. For Mr. Dimon, it was a reprise of his role in the 2008 financial crisis when JPMorgan acquired Bear Stearns and Washington Mutual at the behest of federal regulators.

☆ Why First Republic failed, and what it means for the rest of the banking industry
▼ + stars: | 2023-05-01 | by ( Ryan Hogg | ) www.businessinsider.com time to read: +4 min

First Republic's failure is a stark reminder that the banking crisis is far from over. But despite a speedy takeover by JPMorgan, First Republic's failure shows the banking crisis is far from over. At the end of 2022, two-thirds of First Republic's deposits were uninsured. When SVB and Signature Bank failed, these wealthy customers fled First Republic in droves for fear of losing their cash. The combined failure of SVB, Signature and First Republic is a reminder of the problems affecting the banking system.

☆ 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.

☆ What every consumer should know about bank failures
▼ + stars: | 2023-05-01 | by ( Jeanne Sahadi | ) edition.cnn.com time to read: +4 min

New York CNN —Let’s be frank: If you have a US bank account, hearing about bank failures in the past couple of months hasn’t felt great. Here’s what you need to know to keep things in perspective despite the recent closures of First Republic, Silicon Valley Bank and Signature Bank. How do I know my money is safe? How can I know if my bank will fail? The FDIC will issue information within a day or so of taking over a failed bank to let the bank’s customers know what steps if any they need to take and when.

If a bank fails, insured deposits will be moved to another FDIC-insured bank or paid out. Checking accounts, savings accounts, money market accounts, and certificates of deposit are examples of FDIC-insured bank accounts. Single bank accounts and joint bank accounts are examples of different ownership categories. If you want to keep more money in the bank than the FDIC will insure, you could open another bank account at a separate bank. Aside from First Republic, Silicon Valley Bank, and Signature Bank, the last bank failure happened in October 2020, when Alamena State Bank in Kansas was shut down.

☆ Analysis: Bank failures and looming debt default test American confidence in the economy
▼ + stars: | 2023-05-01 | by ( Zachary B. Wolf | ) edition.cnn.com time to read: +7 min

CNN —Two converging crises are testing American confidence in their financial well-being. And there’s a debt crisis, which is becoming more urgent as the US approaches the “X-date” – when it would default – and on which opposing lawmakers aren’t currently talking to each other. First Republic Bank was taken over by the Federal Deposit Insurance Corporation on Monday, and most of its assets were sold to JPMorgan Chase. Maintaining confidenceNone of that means this is a golden chapter for the American financial system. Now, the debt crisis and the X-dateIf only American lawmakers could take a cue from the First Republic saga and get into a room to solve the debt crisis.

☆ White House banking headache won’t end with First Republic deal
▼ + stars: | 2023-05-01 | by ( Stephen Collinson | ) edition.cnn.com time to read: +7 min

JPMorgan Chase is buying most assets of the troubled First Republic Bank and assuming all of its deposits in a deal announced Monday that was arranged by the US Federal Deposit Insurance Corporation. The independent agency’s new forced intervention is likely to fuel concerns about the overall health of the US banking sector. Biden’s new political headacheThe new concerns over the banking sector put the administration back in an unappealing position. Some progressive Democrats have balked at the idea that already mighty banks will get bigger by stepping in to snap up assets of troubled banks. On Sunday, he called for a shift in federal government policy to ensure all bank deposits.

☆ Key Fed meeting and jobs data are ahead
▼ + stars: | 2023-04-30 | by ( Krystal Hur | ) edition.cnn.com time to read: +5 min

In the spotlight are the Federal Reserve’s May meeting and the April jobs report. Federal Reserve Chairman Jerome Powell will likely face questions about credit conditions, in addition to the central bank’s inflation strategy. What’s at stake with the April jobs report: Economists expect the Bureau of Labor Statistics’ April jobs print to show slower employment growth last month and a rising unemployment rate. Wednesday: Federal Reserve interest rate decision, Chairman Jerome Powell’s press conference and April ADP private payroll report. Friday: April jobs report and March consumer credit.

☆ 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.

☆ Regulators Prepare to Seize and Sell First Republic
▼ + stars: | 2023-04-29 | by ( Lauren Hirsch | Maureen Farrell | ) www.nytimes.com time to read: +1 min

Federal regulators were racing on Saturday to seize and sell the troubled First Republic Bank before financial markets open on Monday, according to four people with knowledge of the matter, in a bid to put an end to a banking crisis that began last month with the collapse of Silicon Valley Bank. has been talking with banks that include JPMorgan Chase and PNC Financial Services about a potential deal, two of the people said. Any buyer would most likely assume the deposits of First Republic, eliminating the need for a government guarantee of deposits in excess of $250,000 — the limit for deposit insurance. would need to decide if it would seize First Republic anyway and take ownership itself. In that case, federal officials could invoke a systemic risk exception to protect those bigger deposits, something they did after the failures of Silicon Valley Bank and Signature Bank in March.

If there has been a lesson in the recent spate of bank failures, it is that deposit flight can now happen quickly. It no longer requires a teller to hand money to customers waiting in long lines around the block. The Federal Deposit Insurance Corporation explicitly insures the first $250,000 in any account, but nothing over that. to guarantee all deposits, but there may be a more strategic, surgical and free-market solution. Consider this: What if the banking system coalesced around a separate insurance program — we’ll call it F.D.I.C.+ — for deposits above $250,000?

☆ What’s next for troubled First Republic Bank
▼ + stars: | 2023-04-29 | by ( Chris Isidore | ) edition.cnn.com time to read: +5 min

New York CNN —First Republic Bank is still an independent bank. The FDIC had already done so with two other similar sized banks just last month — Silicon Valley Bank and Signature Bank — when runs on those banks by their customers left the lenders unable to cover customers’ demands for withdrawals. Nervous major depositorsThe financial report showed depositors had withdrawn about 41% of their money from the bank during the first quarter. In its earnings statement, the bank said insured deposits declined moderately during the quarter and have remained stable from the end of last month through April 21. So when customers lose confidence in a bank and rush to withdrawal their money, what is known as a “run on the bank,” it can cause even an otherwise profitable bank to fail.

☆ Jamie Dimon is vying to take control of First Republic Bank, report says, after JPMorgan steered clear of SVB
▼ + stars: | 2023-04-29 | by ( Ryan Hogg | ) www.businessinsider.com time to read: +3 min

First Republic Bank is set to be taken over by regulators as soon as Sunday. JPMorgan and PNC are frontrunners to acquire the ailing bank, The Wall Street Journal reported. Jamie Dimon might have avoided getting involved in a rescue of Silicon Valley Bank, but it appears that the JPMorgan CEO is preparing to swoop on ailing First Republic Bank. First Republic is worth 97% less than it did before Silicon Valley Bank collapsed last month. Dimon's active involvement in First Republic contrasts his decision to steer clear of any rescue for Silicon Valley Bank.

Depositors had pulled $100 billion from accounts at the bank in the panic triggered by the SVB and Signature failures, imperiling its survival. Both SVB and Signature failed last month. Both SVB and Signature grew quickly in recent years, outpacing the ability of regulators to keep up, especially with shrinking resources. Regulators closed Signature two days after SVB was shuttered. Signature lost 20% of its total deposits in a matter of hours on the day that SVB failed, FDIC Chair Martin Gruenberg has said.

But the benchmark S&P 500 (.SPX) advanced for the week as well as the day and registered a second consecutive monthly gain. For the month the S&P rose 1.5% while the Dow added 2.5% and the Nasdaq was barely higher. For the week the S&P rose 0.9% in line with the Dow's weekly gain and the Nasdaq rose 1.3%. While the S&P 500 bank index closed up 1.1%, shares in First Republic tumbled in the regular session and after the close. The S&P 500 posted 25 new 52-week highs and 2 new lows; the Nasdaq Composite recorded 66 new highs and 136 new lows.

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