JPMorgan CEO Jamie Dimon leading First Republic Bank preliminary rescue discussions

By Sam Boughedda

According to The Wall Street Journal, JPMorgan Chase (NYSE:) Chief Executive Jamie Dimon is heading up talks with the CEOs of other big banks in an effort to stabilize First Republic Bank (NYSE:).

The publication said its sources told them that the preliminary discussions have centered on how the industry could set out an investment to boost the bank’s capital.

Last week, eleven big banks worked together to deposit $30 billion in First Republic to restore confidence in the lender, with its customers said to have withdrawn around $70B since the collapse of Silicon Valley Bank earlier this month.

As a result, First Republic is facing significant pressure to reassure investors it is viable. Its share price has fallen over 86% so far in 2023 and is down over 25% on Monday. The latest wave of selling was triggered by S&P Global cutting the bank’s credit rating by three notches to “B-plus” from “BB-plus.”

The WSJ said sources told them the plan could see the banks convert some or all of the $30B in deposits into a capital infusion, while a sale or outside capital injection are other options.

They add that Dimon, alongside federal regulators, spearheaded last week’s effort to shore up First Republic.