JPMorgan Says It Is Meeting Integration Milestones Since Acquiring First Republic

J.P. Morgan Chase has retained 90% of First Republic’s clients after acquiring the bank in a government-led auction earlier this year.

The achievement reflects J.P. Morgan’s ability to maintain relationships with former First Republic clients and provides an opportunity for further growth, Marianne Lake, J.P. Morgan’s consumer and community-banking co-head, said Tuesday (Dec. 5), Bloomberg reported Tuesday.

Lake was speaking at the Goldman Sachs U.S. Financial Services Conference, according to the report.

First Republic faced significant challenges and became the second-largest bank failure in U.S. history in May, the report said. Rising interest rates created a hole in its balance sheet, leading to a loss of depositor confidence. Depositors initially sought higher interest rates elsewhere and later became fearful after the failure of another California regional lender, Silicon Valley Bank, in March.

Lake said, per the report, the company is on track with its integration milestones.

Lake also provided guidance for J.P. Morgan’s fourth-quarter earnings results, according to the report. The company expects trading revenue to be similar to the previous year, while investment banking fees are projected to experience “healthy growth.”

J.P. Morgan agreed to purchase First Republic following its collapse and subsequent takeover by the Federal Deposit Insurance Corp. (FDIC). J.P. Morgan CEO Jamie Dimon said in May, shortly after the acquisition: “We need to finish the bank crisis.”

Dimon also said in May that adding First Republic’s private wealth operations to J.P. Morgan would allow the roughly 150 brokers from First Republic to “grow their practices,” as their bank’s private wealth management platform becomes part of J.P. Morgan Advisors.

It was reported in October that the acquisition of First Republic supported J.P. Morgan’s goal of keeping and growing its client base among the tech industry and former clients of Silicon Valley Bank.

The bank has also doubled the number of commercial bankers focused on the tech sector, brought on board some of Silicon Valley Bank’s top rainmakers and hosted events in key cities to establish a strong presence in Silicon Valley.