JPM - Treasury Department says First Republic resolution encouraging - report
2023-05-01 12:45:45 ET
The U.S. Treasury Department said it's "encouraged" that First Republic Bank ( NYSE: FRC ) was resolved "with the least cost" to the industry-sponsored Deposit Insurance Fund, calling the country's banking system sound and resilient, according to a Reuters report that cited a Treasury spokesperson.
Earlier on Monday, the FDIC seized San Francisco-based First Republic ( FRC ) and sold most of its assets to JPMorgan Chase ( JPM ) for $10.6B. In reference to the run in deposits withdrawals triggered by the failures of Silicon Valley Bank and Signature Bank in March, JPM CEO Jamie Dimon said he expects "this part of the crisis is over."
The Federal Deposit Insurance Corporation, which will also enter into a loss-sharing deal with JPM on single-family, residential and commercial loans (in addition to providing $50B in financing to the bank), said the cost to the Deposit Insurance Fund is estimated at about $13B.
"Treasury is encouraged that this institution was resolved with the least cost to the Deposit Insurance Fund, and in a manner that protected all depositors," the spokesperson told Reuters.
"The banking system remains sound and resilient, and Americans should feel confident in the safety of their deposits and the ability of the banking system to fulfill its essential function of providing credit to businesses and families."
The Treasury did not immediately respond to Seeking alpha's request for comment.
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Treasury Department says First Republic resolution encouraging - report