The crisis that led to the downfall of three regional U.S. banks in recent weeks is largely over after the resolution of First Republic, according to JPMorgan CEO Jamie Dimon. Full story:
"There are only so many banks that were offsides this way," Dimon told analysts in a call shortly after the deal was announced.
"There may be another smaller one, but this pretty much resolves them all," Dimon said. "This part of the crisis is over."in March of Silicon Valley Bank and Signature Bank, investors have punished other lenders that had similar characteristics to SVB. Companies with the highest percentage of uninsured deposits and losses on their balance sheet were most scrutinized.
The March turmoil exposed poor management by some midsized banks that essentially bet that interest rates wouldn't rise; when rates did rise, the banks were caught "offsides" with unrealized losses from bonds on their balance sheet.for the industry, allowing mid-sized banks to report first-quarter results in recent weeks that in many cases showed a stabilization of deposits. That eased investors' fears that many more lenders would soon topple.
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