Shares of JPMorgan Chase Bank jumped as much as 4% in premarket trade after the United States Federal Deposit Insurance Corporation (FDIC) announced it approved the bank's takeover of First Republic Bank. JPMorgan will acquire "the substantial majority" of First Republic's assets, including around $173 billion of loans and approximately $30 billion of securities. It will assume around $92 billion of deposits, including $30 billion of large bank deposits, "which will be repaid post-close or eliminated in consolidation."
"Our government invited us and others to step up, and we did. Our financial strength, capabilities and business model allowed us to develop a bid to execute the transaction in a way to minimize costs to the Deposit Insurance Fund," JPMorgan CEO Jamie Dimon said. "This acquisition modestly benefits our company overall, it is accretive to shareholders, it helps further advance our wealth strategy, and it is complementary to our existing franchise."
JPMorgan's shares grew 2.39% premarket after the announcement.
