(Bloomberg) -- JPMorgan Chase & Co.’s emergency acquisition of First Republic Bank over the weekend meant the troubled lender’s branches opened as usual Monday to keep serving its well-to-do clientele. Will those spots keep opening?
The vast majority of First Republic’s full-service branches — known for their prowess in catering to wealthy people across the greater New York and San Francisco Bay area — are within a mile of existing Chase locations, a Bloomberg analysis shows.
Indeed, about 60% of First Republic’s outposts are just a five-minute walk — or less — from a Chase branch. Sixteen pairs of them are neighbors, within 0.1 mile. And strikingly, more than a dozen First Republic branches are within half a mile of at least five Chase branches.
The analysis, based on locations on file with the Federal Deposit Insurance Corp. in late April, shows the uncertainty that started swirling around First Republic as customers yanked tens of billions of dollars in deposits in March hasn’t entirely abated for its roughly 7,000 employees.
But just because JPMorgan already has branches near many of those it’s buying, First Republic’s won’t necessarily be shut. Some will be converted into wealth centers, JPMorgan Chief Financial Officer Jeremy Barnum told analysts Monday.
This also might be one of those unusual cases where the buyer decides to close some of its own existing branches, according to Sean Ryan, an analyst at FactSet, who looked into what he called the banks’ “near total” overlapping footprints.
“Many First Republic branches are in good locations, well appointed and worth keeping,” he wrote in a note to clients. That’s especially so on the West Coast, where Chase inherited a lot of its spots through a takeover of Washington Mutual more than a decade ago, he said.
“In many cases, First Republic customers are likely to keep their existing branch, and current Chase customers may be delighted to join them there,” Ryan said.
A JPMorgan spokesperson declined to comment.
As for employees, JPMorgan’s Barnum offered reassurances Monday.
“They are a critical part of First Republic’s well-known value proposition and outstanding customer service and we are committed to treating them with respect, care and transparency,” he said.
Moreover, JPMorgan hires tens of thousands of people in the US every year, he added, “which means that there will be many opportunities for career redeployment.”
--With assistance from Jeremy Cf Lin, Andre Tartar and Jennifer Surane.
To contact the authors of this story:
Linly Lin in San Francisco at [email protected]
Hannah Levitt in New York at [email protected]
