First Republic Bank (FRB) has fallen over, but the Federal Deposit Insurance Corporation (FDIC) is closed by the California Department of Financial Protection and Innovation. The FDIC was appointed as receiver, and the assets will be sold to JPMorgan.

Its assets and deposits total slightly more than USD 330 billion. To safeguard depositors, the FDIC has entered into a purchase and assumption agreement with JPMorgan Chase Bank, National Association, Columbus, Ohio, to acquire all of First Republic Bank's deposits and practically all of its assets. The FDIC also reaffirmed that deposits will continue to be covered at a cost of approximately USD 13 billion to its insurance fund.

The transaction would encompass assets worth USD 229. 1 billion and total deposits at USD 103. 9 billion.

JPMorgan is acquiring all assets and deposits, as well as 84 locations in eight states, and all FRB depositors are now JPMorgan Chase customers. The announcement comes after many days of anticipation that the FRB would fail, sending the stock into a tailspin. JPMorgan and PNC were among the banks that made offers over the weekend.

Following the steps of SVB First Republic, like Silicon Valley Bank, has been a major banking partner to the world of technology as it grew into a massive, and very valuable, industry, providing current accounts and other banking and financial services to a variety of startups, as well as a number of investment firms, through its dedicated technology division. To avoid a spillover impact, First Republic was swift to shift messaging regarding its own stability in the aftermath of SVB's demise. So, at the same time that SVB began selling assets — in fact, at the same time that SVB announced the sale of its UK business to HSBC — First Republic was bolstering its position with massive funding injections to bring its reserves to USD 70 billion.

Stabilising moves Alongside this deal, the FDIC, JPMorgan Chase Bank and National Association, are also entering into a loss-share transaction on a single family, residential, and commercial loans it purchased from the former First Republic Bank. The FDIC is the receiver, while JPMorgan Chase Bank and National Association will share in the losses and potential recoveries on the loans covered by the loss-share agreement.  In taking on insured and uninsured deposits, JPMorgan is, unsurprisingly, positioning itself as standard bearers and ensurers of financial stability through turbulence.

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