Largest Bank Failure Since 2008 as First Republic Seized and Sold to JPMorgan

Mindy Cohn

In the biggest bank casualty yet this year and the largest bank failure since the 2008 financial crisis, First Republic was seized by federal regulators early this morning after the bank disclosed a loss of over $100 billion in deposits. 

Most of the bank's operations were then sold to the highest bidder, JPMorgan Chase (JPM), which assumed $173 billion in assets, $30 billion in securities, and all of First Republic's $92 billion in deposits. 

JPM was given protections by the Federal Deposit Insurance Corporation, which agreed to share losses that might result from some residential and commercial loans.

The $229 billion failure of First Republic is larger than either  Silicon Valley Bank's or Signature Bank's failure in March. Seattle's Washington Mutual still holds the record as the largest bank failure in U.S. history after going under in 2008  with $307 billion in assets in September 2008.

It is estimated that the First Republic failure will cost the FDIC  $13 billion, added to $22 billion from two bank failures in March. 

First Republic has 84 branches, all of which opened as JPMorgan offices as of this morning.

photo credit: Flickr