JPMorgan Chase Acquires Majority of First Republic Bank Assets from FDIC, Becoming Third High-Profile Bank to Fail in US This Year

JPMorgan Chase, the largest bank in the United States, has acquired the substantial majority of assets and assumed the deposits and certain other liabilities of First Republic Bank from the Federal Deposit Insurance Corporation (FDIC).[0] The bank has acquired around $212.6 billion of First Republic’s loans and $92.4 billion in deposits, making it the third high-profile bank to fail in the US this year and the second-largest in the nation’s history.[1] The FDIC put the bank under a receivership and sold all its assets to JPMorgan, and took the liability hit.[2] As part of the deal, the FDIC agreed to provide JPMorgan with $50 billion in long-term loans and take on 80% of any losses that JPMorgan suffers in the next five to seven years on loans that First Republic made to companies and residential mortgages.[3]

First Republic, headquartered in San Francisco, was among the US regional banks most affected by the loss of confidence in the banking sector, as customers panicked following the downfall of Silicon Valley Bank and Signature Bank, two mid-sized lenders, in March.[4] First Republic was also saddled with a toxic mortgage portfolio, and the bank’s focus on mortgage lending, including its push for additional growth as the Federal Reserve began raising interest rates, ultimately contributed to its undoing.[5] First Republic depended on attracting wealthy depositors with “high-touch” service, better than big banks.[6] As per The Wall Street Journal, First Republic suffered a loss of over $100 billion in deposits within a matter of days, following the downfall of Silicon Valley Bank. This amounted to more than half of their total deposits.[6]

Despite some of the nation’s largest banks coming together to help First Republic in mid-March by placing $30 billion in uninsured deposits with the struggling lender, customers fled in droves, pulling roughly $100 billion in deposits in March alone.[4] Excluding the $30 billion in time deposits from the rescue attempt, First Republic ended the month with $74.4 billion in total deposits, down from $173.5 billion on March 9, the day before SVB’s failure.[5] By the close of 2022, First Republic had two-thirds of its deposits without insurance.[7] First Republic experienced a mass exodus of affluent clients after SVB and Signature Bank went bankrupt, as they were afraid of losing their money.[7]

JPMorgan’s acquisition of First Republic’s assets hasn’t stemmed investor concerns about the financial prospects for other regional lenders.[8] This week saw a decline in the value of regional bank stocks, hitting their lowest levels since 2020. Additionally, the Dow Jones Industrial Average plummeted nearly 300 points today, pushing it into negative territory for the year.[6] Today, the stocks of PacWest Bancorp (PACW) declined by over 50%, whereas the shares of First Horizon Bank (FHN) and Western Alliance Bancorp remained stable.[9] The value of (WAL) decreased by over 30%.[9] With FDIC insuring individual depositors up to $250,000, ordinary clients need not worry.[10] The agency has extended its umbrella even wider to cover wealthier bank customers’ accounts, as well as providing a series of backstops and protections for the acquirers of troubled institutions.[6]

The failure of First Republic Bank shows how deregulation has made the too big to fail problem even worse, said Sen. Elizabeth Warren (D-MA) in a tweet.[11] “A poorly supervised bank was snapped up by an even bigger bank—ultimately taxpayers will be on the hook.[12] Congress needs to make major reforms to fix a broken banking system,” she said.[12]

0. “JPMorgan Chase acquires substantial majority of assets and assumes certain liabilities of First Republic Bank” JPMorgan Chase, 1 May. 2023,

1. “Deregulating Banks Is Dangerous” The New Yorker, 1 May. 2023,

2. “Who’s Paying for All These Bank Failures?” Investopedia, 1 May. 2023,

3. “What the First Republic deal means for America’s banks” The Economist, 3 May. 2023,

4. “U.S. Banking System: The Great Consolidation” Statista, 2 May. 2023,

5. “Jim Herbert built First Republic over 40 years. Then it all fell apart.” American Banker, 4 May. 2023,

6. “The latest bank collapses are the canary in a deep coal mine” The Seattle Times, 5 May. 2023,

7. “Why First Republic failed, and what it means for the rest of the banking industry” Business Insider, 1 May. 2023,

8. “Two other regional banks see their stock price dip after First Republic takeover” CBS News, 2 May. 2023,

9. “First Republic Takeover Cuts Emergency Bank Lending” Investopedia, 5 May. 2023,

10. “What the Failure of First Republic Bank Means for You” CNET, 4 May. 2023,

11. “Morgan’s Takeover of First Republic: A Shady Sweetheart Deal” The American Prospect, 3 May. 2023,

12. “Why JPMorgan’s deal for a failing bank has Elizabeth Warren upset” POLITICO, 1 May. 2023,