Dimon: 'This part of the crisis is over'

JPMorgan Chase CEO Jamie Dimon said Monday that the seizure of First Republic puts to rest an excruciating period of panic for the banking system.

"This part of the crisis is over," he told analysts on a Monday conference call.

In the last eight weeks, three of the biggest 30 US banks failed and hundreds of billions in deposits left small banks as customers scrambled for safety and higher yields.

First Republic (FRC) became the biggest casualty of this turmoil Monday when regulators seized the $229 billion institution and sold the bulk of its operations to JPMorgan (JPM).

It puts Dimon back at the center of a banking crisis for the second time in 15 years. In 2008 JPMorgan purchased investment bank Bear Stearns and then Seattle’s Washington Mutual.

This period, he told reporters Monday, "is nothing like 2008, 2009 for a lot of different reasons."

There are only so many banks, he said, that have problems that were as extreme as First Republic’s were. The San Francisco lender had a heavy reliance on an excessive amount of uninsured deposits and a large exposure to rising interest rates.

That’s not to say that all is fine, Dimon added. With rates rising and with the possibility of a recession looming, "you will see other cracks in the system. That’s to be expected."

Real estate could also get worse, he said, "and hopefully people are probably prepared for it."

But the market crisis surrounding banks, he said, "is over."

Dimon forcefully rejected any concerns about the nation’s biggest bank getting even bigger as a result of this deal.

There is an existing rule preventing any bank like JPMorgan from making an acquisition providing it with more than 10% of all US deposits. JPMorgan is already above that cap but regulators waived those deposit concentration restrictions and blessed the deal anyway.

"We already get a lot of scrutiny," he said, adding that “we need large successful banks in the largest and most prosperous economy in the world," citing clients from cities and schools to states and countries.

“For anyone who thinks that the United States of America should not have that should call me directly,” Dimon added.

One analyst who covers the banking industry, Wedbush Securities' David Chiaverini, agreed with Dimon's view of the First Republic failure.

"This was the last of the big banks that was teetering," he told Yahoo Finance. "With this behind the industry it should lead to additional confidence that...the acute stress in the system is behind us."

Citigroup CEO Jane Fraser offered a similar take, speaking Monday at a Milken Institute conference in California.

"This is not the great financial crisis, this is not the savings and loan crisis," she said. "There will be stress...and I’m sure some of you will make a lot of money off of this."

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