Brooke Masters, Stephen Gandel, James Fontanella-Khan in New York and James Politi and Colby Smith in Washington
JPMorgan Chase is to acquire most of First Republic after US regulators orchestrated an overnight deal to shut the embattled California lender, wiping out its shareholders in the second-biggest bank failure in the country’s history.
The Federal Deposit Insurance Corporation and California regulators, which announced the deal early on Monday morning, said they were simultaneously closing the bank and selling off all $93.5bn of its deposits and most of its assets to JPMorgan.
The only bigger bank failure in US history was the collapse of Washington Mutual in 2008. While First Republic’s market capitalisation was $25bn in February, all its previous shareholders have now been wiped out.
The regulators’ move follows weeks of turmoil in the US banking system after the failure of Silicon Valley Bank in March.
Read more about First Republic’s fate here