JPMorgan Chase Expects the First Republic Deal to Boost Profit by $500 Million. But That Seems Conservative
JPMorgan Chase (NYSE: JPM), the largest bank in the U.S. by assets, recently purchased most of the assets of First Republic (NYSE: FRC) from the Federal Deposit Insurance Corp. (FDIC) after First Republic was seized by regulators.
The deal comes with a number of benefits and is expected to immediately boost JPMorgan Chase's annual profit by $500 million a year. That seems like a pretty modest gain considering that JPMorgan generated close to $42 billion of net income over the last year.
But management's estimates on the earnings accretion from First Republic seem quite conservative. Here's why.
Source Fool.com