First Republic put into receivership, JPMorgan assumes all deposits

First Republic Bank (FRC) was closed by the California Department of Financial Protection and Innovation, which appointed the Federal Deposit Insurance Corporation as receiver. To protect depositors, the FDIC is entering into a purchase and assumption agreement with JPMorgan Chase (JPM) to assume all of the deposits and substantially all of the assets of First Republic Bank, the agency said in a statement. JPMorgan submitted a bid for all of First Republic Bank’s deposits. As part of the transaction, First Republic Bank’s 84 offices in eight states will reopen as branches of JPMorgan Chase Bank today during normal business hours. All depositors of First Republic Bank will become depositors of JPMorgan Chase and will have full access to all of their deposits. As of April 13, First Republic Bank had approximately $229.1B in total assets and $103.9B in total deposits. In addition to assuming all of the deposits, JPMorgan agreed to purchase substantially all of First Republic Bank’s assets. The FDIC and JPMorgan are also entering into a loss-share transaction on single family, residential and commercial loans it purchased of the former First Republic Bank. The FDIC as receiver and JPMorgan will share in the losses and potential recoveries on the loans covered by the loss-share agreement. The loss-share transaction is projected to maximize recoveries on the assets by keeping them in the private sector. The FDIC estimates that the cost to the Deposit Insurance Fund will be about $13B. Reference Link