First Republic Taken Over By FDIC, Sold to JPMorgan Chase

First Republic Bank was seized by the FDIC and sold to JPMorgan Chase & Co, in what is the third major US institution to fail in two months.

JP Morgan will take most of First Republic’s assets and all the $93 billion in deposits, including uninsured ones.

The deal involved a “highly competitive bidding process,” the FDIC said, but it did not say what JPMorgan is paying to purchase the failed bank.

JPMorgan was one of several interested buyers including PNC Financial Services Group, and Citizens Financial Group Inc which submitted final bids on Sunday in an auction being run by the FDIC.

The California Department of Financial Protection and Innovation announced early on Monday it had taken possession of First Republic and the FDIC would act as its receiver.

The FDIC estimated the cost to the Deposit Insurance Fund would be about $13 billion. The final cost will be determined when the FDIC terminates the receivership.

“Our government invited us and others to step up, and we did,” JP Morgan Chairman and CEO Jamie Dimon said. “Our financial strength, capabilities and business model allowed us to develop a bid to execute the transaction in a way to minimize costs to the Deposit Insurance Fund.”

The rescue comes less than two months after Silicon Valley Bank and Signature Bank failed amid a deposit flight from US lenders, forcing the Federal Reserve to step in with emergency measures to stabilize markets.

First Republic’s 84 offices in eight states will reopen as branches of JPMorgan, and depositors will be able to access all their money today.

First Republic had about $229.1 billion in assets and $103.9 billion in deposits.