Monday, September 25, 2023

Second largest bank failure in America

Another addition to the list is Silicon Valley Bank, which held $67 billion in assets at the time of its bankruptcy.

For only a month, the Silicon Valley bank was the second largest bank failure in US history, until First Republic Bank, a California lender that catered to wealthy clients, ousted it from that spot.

First Republic was seized by the Federal Deposit Insurance Corporation early Monday after failing to repair losses caused by customer withdrawals and plunging property prices. US regulator JP Morgan has reached an agreement to take over the bank’s assets, including $173 billion in loans and $30 billion in securities, as well as $92 billion in deposits, after bailing out the lender. The talks will go on for weeks.

First Republic’s $229 billion in assets as of April 13 is just behind Washington Mutual, which burst out in 2008 with $307 billion in such holdings and total deposits of $188 billion. At that point, the FDIC seized the Seattle-based firm’s banking operations and sold them to JPMorgan for $1.9 billion.

Three of the biggest FDIC failures of this century occurred in recent weeks, with the collapses of Silicon Valley Bank and Signature Bank in early March. Silicon Valley Bank had $167 billion in assets at the time of its bankruptcy.

First Republic Became The Second Largest Bank Failure In Us History.

First Republic became the second largest bank failure in US history.

JP Morgan to the rescue

California’s financial regulators seized First Republic Bank and sold all of its deposits and most of its assets to JPMorgan Chase Bank in an effort to prevent a banking turmoil in the United States.

San Francisco-based First Republic is the third mid-sized bank to fail in two months. Since the failure of Silicon Valley Bank and Signature Bank, investors and depositors have become increasingly concerned that it may not survive due to the high volume of uninsured deposits and the risk of low-interest rate loans.

The Federal Deposit Insurance Corporation (FDIC) reported Monday that 84 First Republic Bank branches in eight states will reopen on Monday as JPMorgan Chase bank branches.

Regulators worked through the weekend to clear the way before US stock markets opened. Markets were closed in many parts of the world on Monday due to the May 1 holiday. The two open Asian markets, Tokyo and Sydney, edged higher. As of April 13, First Republic held approximately $229 billion in total assets and $104 billion in total deposits, according to the FDIC. At the end of last year, the Federal Reserve ranked it 14th in size among US commercial banks.

World Nation News Desk
World Nation News Desk
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