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First Republic Financial Advisors Impacted by Bank’s Failure

By George C. Miller, Partner of Shustak Reynolds & Partners, P.C. posted on Friday, May 12, 2023.

George C. Miller

George C. Miller


Location: San Diego, California
Phone: (619) 696-9500 (Ext. 105)
Direct: (619) 501-8270
Email[email protected]

First Republic Bank’s May 1, 2023, collapse marked the largest U.S. bank failure since the 2008 Great Recession, when Washington Mutual imploded. Regulators were forced to step in, and J.P. Morgan Chase acquired the bank’s deposits and a majority of its remaining assets. First Republic’s 84 branch offices will remain open, at least for now, having been rebranded as JPMorgan Chase Bank. But what about the hundreds of financial advisors affiliated with First Republic’s subsidiary broker-dealer and investment advisory firms?

Until its failure, First Republic Bank was the parent company of First Republic Securities Company, LLC, a FINRA broker-dealer, and an SEC-registered investment advisory firm, First Republic Investment Management, Inc. It catered to wealthy investors through a panoply of investing, private banking, and lending services. Until its abrupt failure, First Republic had been on a tear, luring some of the top-producing financial advisors across the country into the firm with record-setting up-front recruiting “bonuses” tied to substantial forgivable promissory notes. They targeted advisors and teams averaging $5 million or more in annual revenue. Now, through no fault of their own, the landscape has shifted, and advisors who were promised a stable platform and access to “white glove” banking services at First Republic are left holding the bag.

As part of the acquisition, JPMorgan acquired both First Republic Securities Company and First Republic Investment Management. JP Morgan is encouraging those advisors to stay on. But during an early May call, JPMorgan CEO Jamie Dimon reported First Republic’s total advisor headcount had dipped to 150, down from around 300 in early 2023. Dozens of advisors and teams have already left First Republic, and many more are sure to leave in the months to come. Through no fault of their own, the firm they joined and convinced their clients to join exists no more. Many of those advisors still have large, forgivable promissory notes which could further complicate a potential exit from JPMorgan.

Any financial advisors considering a transition should consult experienced counsel. Our FINRA and financial services attorneys are highly experienced in the FINRA arbitration process. Any representatives who have been named in an arbitration, or who are considering an arbitration claim should consult qualified counsel.

Shustak Reynolds & Partners, P.C. focuses its practice on securities and financial services law and complex business disputes.
We represent many investment advisers, IARs, broker-dealers, registered representatives, and businesses.
Attorney Geroge C. Miller can be reached in the firm’s San Diego office at (619) 696-9500.

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