Recently, a US bank called First Republic Bank failed, which means it could no longer operate because of financial problems. It was the third bank in the US to fail in less than two months.
The California Department of Financial Protection and Innovation took control of the bank and decided to sell it to JP Morgan Chase and Co. This means that JP Morgan Chase and Co will now own most of First Republic Bank’s assets and all of its deposits, which are the money people have saved in the bank.
Before selling the bank, other companies were also interested in buying it, such as PNC Financial Services Group and Citizens Financial Group Inc. The California regulators said that JP Morgan Chase and Co was chosen because it offered the best deal.
The Federal Deposit Insurance Corporation (FDIC) is now responsible for taking care of the bank and its money. They estimate that it will cost around $13 billion to manage the bank’s money. However, the final cost will be known when the FDIC finishes managing the bank’s money.
After the deal was finalized, First Republic Bank’s 84 offices in eight states will become JP Morgan Chase Bank branches.