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What Really Happened with First Republic Bank
The FDIC (funded by everyone’s bank deposits nationwide) took over FRB this past weekend and conducted an auction with Big Banks to find a buyer.
– JPMorgan stepped in and offered to buy First Republic, but only if the US Government guaranteed to backstop any losses.
– The FDIC agreed.
JPM bought FRB, getting all the “healthy” assets and deposits for pennies on the dollar and the FDIC (meaning everyone with bank deposits nationwide) kept the toxic assets.
– The toxic assets consist of “interest-only” mortgages held by ultra-wealthy homeowners.
– The FDIC will likely bail out the wealthy homeowners leaving all of us to foot the bill.
You can’t make this stuff up! What a wonderful financial system we have…
If JPM-Chase wanted to buy First Republic in early February this year, they would’ve had to pay over $140 per share. They likely paid less than $5.00 per share today, without any of FRB’s toxic assets – thanks to the FDIC.
Jamie Diamond (JPM CEO) is laughing all the way to his bank.
I wonder which bank is next?
Source: @GCR_RealTimeNews
Many Blessings,
Ai3D
Rose Rambles... 