Jamie Dimon on Tuesday offered investors his views on the likelihood of JPMorgan Chase doing another purchase of a regional bank facing difficulties.
The chief executive described it as being “unlikely” a purchase of another struggling lender by JPMorgan Chase would occur. He made the comment at the annual meeting of shareholders that took place Tuesday morning.
JPMorgan Chase and the Federal Deposit Insurance Corporation (FDIC) revealed May 1 that the bank would purchase embattled California-based First Republic Bank. Under the agreement, JPMorgan Chase is assuming all of the bank’s deposits and a “substantial majority” of its assets.
JPMORGAN BUYS FIRST REPUBLIC BANK, DIMON DECLARES ‘THIS PART OF THE CRISIS IS OVER’
That deal came about after First Republic experienced an eye-popping decline in its deposits in mid-March and was given $30 billion in uninsured deposits from major U.S. banks. The FDIC took control of the bank in early May.
JPMorgan Chase’s consumer and community banking co-CEOs will run the First Republic businesses it purchased, the company said at the beginning of the month. The bank has also said it was paying $10.6 billion for the assets it purchased.
Dimon said Tuesday that First Republic “will further help our wealth as well as other initiatives.”
The CEO also repeated his faith in the financial soundness of the regional banking system and said regulators could not have evaded the risks that led to the wipeout of three U.S. banks.
“It is unlikely that any recent change in regulatory requirements would have made a difference,” he said.
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Prior to First Republic’s rescue, two banks, Silicon Valley Bank and Signature Bank, were taken over by the FDIC in March. Another, Silvergate, folded not long prior to that.
Turbulence in the market — particularly among some banking stocks — followed those three collapses, as well as stirred worries of additional failures.
When talking about JPMorgan’s acquisition of First Republic in early May, Dimon said he thought the banking system was “very stable.”
He said that there were “only so many banks offsides this way” and that the move with First Republic “pretty much resolves them all,” adding, “For now, everyone should just take a deep breath.”
A slew of proposals were also up for a vote at Tuesday’s annual meeting. While all management proposals passed, all of the motions submitted by shareholders failed.
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Several of the ones offered by shareholders garnered a percentage of votes that was large enough to typically draw management’s attention.
|JPM||JPMORGAN CHASE & CO.||134.32||-0.94||-0.69%|
The stock price of JPMorgan Chase sat around $134 at close, marking a nearly 10% increase in the past 12 months.
Reuters and Breck Dumas contributed to this report.
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