JPMorgan Chase will shutter more than 20 First Republic branches by the end of this year, following its takeover of the failed bank, the company announced on June 1.
First Republic has 84 branches across eight states, including California, Connecticut, and Florida, according to its official website.
The upcoming closures make up roughly a quarter of its locations.
“After a thorough review, we have decided to close 21 former First Republic Preferred Banking Offices by the end of 2023, representing a quarter of the offices we acquired,” JPMorgan said in an emailed statement to The Epoch Times.
“These locations have relatively low transaction volumes and are generally within a short drive from another First Republic office,” the bank added.
Roughly 100 employees will be affected by the closures, a spokesperson told CNN. Impacted employees will be offered six-month transition assignments, after which they will be eligible to apply for other roles at JPMorgan, which currently has about 13,000 open roles.
If the employees are unable to find a job with JPMorgan, the bank will help them find a job elsewhere, the spokesperson said.
Run on Deposits
The run on deposits came despite the lender reassuring customers that their money was safe following widespread concerns of contagion across regional banks. The reassurance appeared to do little as shares of the bank plunged more than 60 percent.First Republic was not alone. Banks across the nation, including SVB, had been battling with increased pressure from the Federal Reserve’s rapid rate hikes in an effort to bring down soaring inflation, a dry-up in venture capital, and the fact that a high percentage of their customer deposits were invested in Treasury bonds, which are highly sensitive to interest rates.
As a result, many Americans raced to withdraw their hard-earned savings while the Biden administration and banking officials attempted to ease panic and prevent a widespread collapse in the banking sector.
First Republic is the second-largest bank failure in U.S. history, following the collapse of Washington Mutual in 2008, and was the fourth regional lender to collapse since early March.
JPMorgan beat out a string of rivals in a government-led auction to acquire roughly $173 billion of First Republic’s loans, $30 billion of securities, and $92 billion in deposits.
Job Cuts
Prior to its takeover, JPMorgan Chase had also joined a handful of other large U.S. banks, including Bank of America, Citigroup, Wells Fargo, Goldman Sachs, and Morgan Stanley in making a $30 billion injection of uninsured deposits into First Republic to help stabilize the troubled lender.Following the acquisition, First Republic said it remains committed to supporting clients during the transition period and beyond.
“You can rest assured that all of your deposits are backed by JPMorgan Chase’s financial strength and stability,” the bank said. “Over time, you will also have access to JPMorgan Chase’s extensive branch network, the largest in the country, with more than 4,700 Chase branches across all lower 48 states and the District of Columbia, and more than 15,000 ATMs in 49 states.”
The latest announcement regarding branch closures comes after JPMorgan last week said informed around 1,000 First Republic Bank employees that they will lose their jobs.
“The vast majority of First Republic employees will be offered employment at JPMorgan Chase—either through a transition period, or, in many cases, full-time,” a JPMorgan spokesperson said in a statement to Business Insider.
“Employees who have not been offered a role will receive pay and benefits covering 60 days and will be offered a package that includes an additional lump-sum payment and continuing benefits coverage,” the spokesperson said.
First Republic, which had around 7,200 employees before its collapse, had already slashed roughly 25 percent of its workforce before it was acquired by JPMorgan.
The Epoch Times has contacted JPMorgan for further comment.
