Rep. Roger Williams, R-Texas, discusses the collapse of First Republic Bank, the Treasury Department’s reaction, Biden’s new mortgage rule and the looming threat posed by Title 42’s upcoming expiration.
Shares of major U.S. banks are mostly higher after JPMorgan Chase announced Monday that it would purchase most of the assets of the struggling First Republic Bank.
JPMorgan, Wells Fargo, Bank of America and Citigroup are all in positive territory in morning trading.
|JPM||JPMORGAN CHASE & CO.||138.24||+1.19||+0.87%|
|FRC||FIRST REPUBLIC BANK (SAN FRANCISCO CALIFORNIA)||3.50||-2.69||-43.46%|
As part of the deal, JPMorgan will make a $10.6 billion payment to the Federal Deposit Insurance Corp (FDIC) for most of the San Francisco-based lender's assets, after government regulators seized control of the failed bank over the weekend, securing the third major U.S. financial institution to collapse in 60 days.
The JP Morgan Chase & Co. headquarters, in Manhattan, New York, on Jan. 27, 2014. (Photo by Tim Clayton/Corbis via Getty Images / Getty Images)
FDIC ACCEPTS JPMORGAN CHASE'S BID TO BUY FIRST REPUBLIC BANK
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.
|WFC||WELLS FARGO & CO.||39.75||+0.09||+0.23%|
|BAC||BANK OF AMERICA CORP.||29.28||+0.39||+1.35%|
A person walks past the Park Avenue location of the First Republic Bank, in New York City, U.S., Mar. 10, 2023. (Reuters/David ‘Dee’ Delgado / Reuters Photos)
First Republic came under intense pressure after disclosing last week that it had suffered more than $100 billion in outflows in the first quarter and was exploring options.
The acquired businesses will be overseen by JPMorgan’s Consumer and Community Banking co-CEOs, Marianne Lake and Jennifer Piepszak, the bank said in a statement.
The rescue comes less than two months after a deposit flight from U.S. lenders forced the Federal Reserve to step in with emergency measures to stabilize markets.
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Reuters contributed to this report.