The govt has stuffed First Republican Bank down the throat of JP Morgan. The bank based in California started limping after the collapse of Silicon Valley Bank. By April 24th a bank run had seen $100B withdrawn by account holders. I’m looking at the business models of these two banks and I suspect money laundering at work. SVB financed IR start-ups operating all over the world. This is how it works. A venture capitalist offers to finance a start-up, he takes a loan from SVB and the start-up is required to have an account at SVB, this way the bank has a new account and earns money twice from the same loan (interest and loaning out money from the new account). First Republic Bank was financing the rich especially in mortgages. They gave mortgages at low rates as long as the rich bugger deposited his a big chunk of his wealth in account with the bank. This kind of exclusive clientele business strategy stinks to high heavens. Why did the bank’s collapse then yet there was no major crisis affecting their clientele?
And I forgot to add the deposits were largely uninsured.
Sina nguvu ya kurudia connection ya fed na interest rates na ku collapse kwa hizi banks but nitasema…
… Degree muhimu sana.
Apana ongea vitu hujui.
Sawa nitatafuta degree. Degree yako haijakushow that it was my hunch not any analysis of the bank industry in yuess as a whole. I was looking under the carpet while you were poring over their books. Degree yako haijakushow, there are many ways of looking at a study subject?
Degree muhimu sana sana
Thank you for telling him the truth.
[SIZE=7]First Republic Is Sold: What to Know[/SIZE]
First Republic is the second-largest bank by assets to fail in U.S. history.
First Republic Bank’s failure had much the same roots as the collapses of Silicon Valley Bank and Signature Bank — spooked depositors and investors pulling their money and selling their shares in droves.
Here are some answers to questions you may have about what comes next for the bank and for your money.
[SIZE=6]Why was First Republic seized?[/SIZE]
In the turmoil set off by Silicon Valley Bank’s collapse, First Republic was initially bailed out by the private sector. In March, it received $30 billion in deposits from 11 of the country’s largest banks, including JPMorgan, Morgan Stanley and Wells Fargo.
But First Republic struggled nonetheless, and its condition had been deteriorating for weeks. It had seen a large outflow of funds as depositors rushed to pull their money and park it in institutions they viewed as safer.
Its shares had been pummeled — they dropped 75 percent just last week — as investors feared that it would fail. That drop came after the company released earnings results saying that it had borrowed heavily from the Federal Reserve and government-backed lending groups, the financial industry’s lenders of last resort.
[SIZE=6]Why would JPMorgan buy First Republic?[/SIZE]
In the event of a bank failure, another bank may have an incentive to take over the embattled lender because it’s looking to expand its footprint in a region or build relationships with new customers.
On Monday, 84 First Republic branches in eight states will reopen as JPMorgan branches.
But the acquisition makes JPMorgan, already the nation’s largest bank, even bigger and could draw political scrutiny.
Over the weekend, federal regulators were racing to find a buyer for First Republic before the markets opened on Monday. JPMorgan, PNC Financial Services and Bank of America were all at some point in talks with the F.D.I.C. about a potential deal.
“The F.D.I.C. wants banks to take over other banks,” Ms. Heitz said.
One way it incentivizes buyers is by sharing in any potential losses that a buyer might take, in what’s called a shared-loss agreement. JPMorgan said the F.D.I.C. would provide loss share agreements in the First Republic deal including for some home mortgages and business loans.
[SIZE=6]Does this mean deposits are safe?[/SIZE]
Yes. The F.D.I.C.’s rules guarantee that deposits up to $250,000 will be covered, per depositor, per bank. The insurance coverage categories include checking and savings accounts and certificates of deposit. People who have a joint account with someone else, like a spouse, each get $250,000 in coverage, for a potential total of $500,000 in a single joint account.
People with different types of holdings can add them up. If the total does not exceed $250,000, multiple holdings — say a $50,000 savings account and a $20,000 certificate of deposit — will be covered. And the insurance is automatic.
Customers of Silicon Valley Bank and Signature Bank did not lose any of their deposits. Regulators opted to pay all depositors back in full after invoking the “systemic risk exception,” which is intended to protect against systemwide destabilization.
In First Republic’s case, JPMorgan will assume the lender’s deposits, which would eliminate the need for the government to grant a systemic risk exception.
Tangu lini BArs degree ikakuabna story za interest rates? Get yourself a BSc kijana.
Lawdy Lawd! This is the official position. Is it the ultimate truth? A degree is meant to make you think beyond what you read
A fund is raised from loans? Not LP’s?
If you go beyond the reports you notice some fishy dealings
You cannot raise a fund via loans
I used the word loan but I know it ain’t so, but money is advanced to the start-up