JPMorgan is cutting about 1,000 First Republic Bank employees
By Matt Egan, CNN
(CNN) — JPMorgan Chase informed about 1,000 First Republic Bank employees on Thursday that they will no longer have jobs.
JPMorgan acquired most of First Republic’s assets earlier this month after the San Francisco-based regional bank was seized by the government. It marked the second-biggest bank failure in US history.
A JPMorgan spokesperson told CNN that the bank updated all First Republic employees on Thursday about their future employment status and the vast majority — or nearly 85% — have been offered a transitional or full-time role.
That leaves 15%, or about 1,000, First Republic employees who are not receiving an employment offer. News of the job impact was previously reported by the Financial Times.
JPMorgan said the company’s May 1 deal with the Federal Deposit Insurance Corporation to buy most of First Republic did not include all of the company’s employees.
“We’ve been transparent with their employees and kept our promise to update them on their employment status within 30 days,” JPMorgan said in a statement. “We recognize that they have been under stress and uncertainty since March and hope that today will bring clarity and closure.”
The bank said that employees who have not been offered a role will receive pay and benefits covering 60 days and will be offered a package that includes an additional lump sum as well as continuing benefits coverage and resources to find new opportunities.
It’s not clear how many First Republic employees that have been offered employment at JPMorgan will have full-time versus transitional roles.
The transitional roles being offered to some First Republic employees will last for a period of between three and 12 months, JPMorgan said.
After regulators shut First Republic down, JPMorgan won a competitive bidding process run by the FDIC. JPMorgan agreed to make a $10.6 billion payment to the corporation.
Some progressives including Sen. Elizabeth Warren, D-Mass., have been critical of the First Republic deal because it allowed America’s biggest bank to get even bigger.
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