Today, the US authorities have taken control of yet another bank in crisis. California-based First Republic is the third US bank to collapse since March.

The California-based bank First Republic is now secured by the American bank insurance fund FDIC and is the third American bank to fail since March.

J.P. Morgan was one of several major banks that the US authorities asked for bids to take over operations which they won.

So today 84 First Republic branches open as J.P.Morgan branches and all the customers have (involuntarily) become customers of J.P.Morgan.

But otherwise it is “business as usual”: the FDIC guarantees the customers’ deposits and assets and the cost of the insurance fund is calculated at 13 billion dollars.

First Republic has struggled for a long time in the storm surrounding the banking sector. Net deposits were about $104 billion with total assets valued at about $229 billion.

An association of banks tried to get a rescue package in place in mid-March, but it did not work. J.P. Morgan announced in a press release:

Our financial strength and business model allowed us to design a bid to complete the transaction that minimises the costs for the deposit insurance fund.

The biggest bank collapse in US history was Washington Mutual, it happened during the financial crisis of 2008. Lehman Brothers is known as the main culprit having been turned into a pure pyramid scheme, but this was an investment bank, so it is not included in the authorities’ lists of regular banks.

First Republic Bank is the second largest bank collapse, followed by Silicon Valley Bank and crypto-oriented Signature Bank, all of which have gone under recently.

Therefore, it can be stated that the problems in the American banking sector are by no means over.

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