Can we breathe a sigh of relief now? The impact of First Republic Bank takeover by JP Morgan on the US equity markets

Abstract

This paper investigates the effects of the takeover of First Republic Bank (FRB) by JP Morgan Chase on different US equity indices. Results from an event-study approach reveal that this acquisition exerts no significant impact on US equity markets, indicating that these markets in the US are relatively immune to extreme shocks and therefore, could act as a safe haven for investors during times of high uncertainty. © 2023 Elsevier Inc.

Keywords: Bank failures, Equity markets, Event-study approach, Financial crisis, Takeover