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Morning news brief

LEILA FADEL, HOST:

Another U.S. bank has failed, the third one this year after Silicon Valley Bank and Signature Bank.

A MARTÍNEZ, HOST:

Overnight, California regulators closed First Republic Bank and put it into receivership. Then federal regulators announced JPMorgan Chase, the biggest of the big banks, has bought the majority of First Republic's assets and deposits.

FADEL: NPR's David Gura joins us now with the latest. Good morning, David.

DAVID GURA, BYLINE: Hey, Leila.

FADEL: OK, so what is JPMorgan Chase buying? And how did this sale come to be?

GURA: Well, JPMorgan is buying all the deposits at First Republic Bank, about $100 billion of them in total, and most of First Republic Bank's assets as well. That's according to the Federal Deposit Insurance Corporation, the FDIC, which is First Republic Bank's primary regulator. You know, last week, as the trouble that the bank was in worsened, the FDIC approached several larger lenders and said, basically, take a look at First Republic. If it's something you'd want, submit a bid by Sunday. And we know several banks did that.

The FDIC evaluated those bids. We learned about First Republic's failure and the outcome of that process shortly after midnight, California time - just after 3 o'clock in New York. And I'll note, unlike what happened with Silicon Valley Bank and Signature Bank, this time around, the FDIC did not use its emergency powers to do this. And JPMorgan's CEO, Jamie Dimon, said in a statement the bank made its bid in a way that will minimize costs to the FDIC's deposit insurance fund. And, Leila, it says the cost will be about $13 billion.

FADEL: Now, this is the third bank in the U.S. to fail. What happened this time at First Republic Bank that led to this failure?

GURA: Well, in the immediate aftermath of the collapse of those two banks in March, there was this fear we would see more bank runs. First Republic was swept up in that. And it immediately sought to reassure its customers and investors. It lined up additional financing. And when that didn't calm nerves, 11 of the biggest banks in the U.S. stepped in to offer First Republic a lifeline. They deposited $30 billion at First Republic Bank. That still didn't make much of a difference. First Republic share price just kept falling. And last week, when First Republic reported its earnings, we learned its customers had withdrawn way more money than Wall Street expected, more than $100 billion in deposits in March. So this was a bank that was really suffering. And we were at this cliffhanger moment, as one Wall Street analyst put it to me, everyone wondering what would happen next, Leila, recognizing the situation was bad enough that something had to happen.

FADEL: So David, what does this announcement mean for customers of First Republic Bank?

GURA: For them, regulators and JPMorgan stress it should be business as usual. There are more than 80 First Republic Bank branches in eight states in the U.S., including in California and New York. And those customers will be able to access their money at those branches today. They're now automatically customers of JPMorgan Chase. I'll stress taxpayers are not on the hook here. JPMorgan and the FDIC are going to share in any losses on First Republic's loans. And that $13 billion cost I mentioned just a minute ago, that'll come out of a fund that banks pay into.

FADEL: Now, David, there are probably people listening right now thinking, is my money safe in whatever bank I'm banking at? What does this move mean for the health of the banking sector, the markets? Is there more turmoil ahead?

GURA: Analysts I spoke with emphasize the circumstances around the failure of First Republic are unique. And this is unlikely to lead to the kind of volatility we saw after Silicon Valley Bank and Signature Bank collapsed. And many other lenders said in their earnings recently that deposits at those banks have stabilized. Now, in terms of the market, there was hope and an expectation, really, among investors a deal like this would get hammered out before markets opened in Asia. Of course, that didn't happen. But this was squared away pretty tidily before the opening bell in New York.

FADEL: NPR's David Gura.

Thanks, David.

GURA: Thank you.

(SOUNDBITE OF MUSIC)

FADEL: Leaders of the warring factions in Sudan have agreed, in theory, to extend a cease-fire from the weekend. But that cease-fire and almost all that have come before it haven't really stopped the fighting.

MARTÍNEZ: Thousands of people are still trying to flee the country, including many U.S. citizens and other foreigners. Ships are taking some to Saudi Arabia.

FADEL: NPR's Aya Batrawy joins us from the port of Jeddah. Hi, Aya.

AYA BATRAWY, BYLINE: Hi, Leila.

FADEL: OK, so you're at the port right now. What are you seeing?

BATRAWY: So I'm at a hot, windy, sunny port on the Red Sea coast of Saudi Arabia. And I'm looking at a massive U.S. naval ship called the Brunswick that just got here this morning. It was traveling over 12 hours, it seems, overnight from Port Sudan. And it is carrying the first U.S. naval evacuation of U.S. citizens. Around a hundred U.S. citizens are on this ship. And about 200 other citizens from other countries have boarded the ship. And this is not the first time, though, that countries have used their naval ships to disembark from Port Sudan and bring their citizens here. India has sent several ships. China has done the same. And Saudi Arabia is also sending its naval ships to bring on other citizens of other countries and bring them to the safety of Saudi Arabia.

FADEL: So thousands of foreigners who've gotten to this port where you're at. What are people saying to you who've evacuated?

BATRAWY: So yesterday, I met a guy named Adel al-Bashir. He's a Sudanese American who had been living in the capital, Khartoum, of Sudan for the past six months for work. His wife and kids live in Virginia. He was the sole American aboard a Saudi naval vessel that docked here yesterday. And here's what he told me Khartoum looks like.

ADEL AL-BASHIR: A lot of bombs, a lot of bullets everywhere, dead bodies everywhere, destruction everywhere, and just people - scary.

BATRAWY: So frightening situation in Khartoum.

FADEL: Yeah.

BATRAWY: And then I asked him if he'd gotten any help from the U.S. State Department in evacuating Sudan.

AL-BASHIR: Yes. American Embassy sent me an email, like, three days ago. They asked me to leave within 48 hours. And they arranged this evacuation for me.

BATRAWY: So they put your name on a list for this boat, and then you had to figure out how to get to Port Sudan on your own?

AL-BASHIR: Yes. You have to get - because they cannot do anything inside Khartoum. When I get to Port Sudan, I found everything arranged over there.

BATRAWY: Right. And the reason the U.S. can't do anything inside Khartoum is because the U.S. and many other embassies have closed and evacuated their staff. It's also dangerous getting out of Khartoum. But once you get to Port Sudan, many people are just sleeping roughshod under tarps. But again, these are the lucky ones that have been able to take this route out safely. And there are still many more trying to do just that.

FADEL: Yeah, I mean, it doesn't sound like an easy journey at all for so many people. What else can you tell us about the situation in Port Sudan, where, as you describe, people are sleeping, trying to get out of the country?

BATRAWY: Right. So there's also people from Syria and Yemen having trouble getting out and coming to Saudi Arabia. But look, the port finally received some international aid yesterday. A shipment of eight tons of medical aid arrived to Port Sudan from the International Red Cross. And this is significant because we just haven't seen aid agencies do much besides evacuate their own staff from Sudan. And meanwhile, life in the capital, Khartoum, has come to a complete standstill. Everything is shuttered. Hospitals are running dangerously low on supplies. Something like 60% of all the hospitals around the country have lacking supplies, have shut down. So there's still a lot of fighting going on, but it's hard to figure that out - where...

FADEL: Now, the people you've been speaking to are people who have another passport or are foreigners. What about Sudanese who don't have that second passport? How do they get out?

BATRAWY: They can't get here. They're not allowed to come here. Saudi Arabia does not host refugees, so they're trying to just make it across borders. And that's a really hard journey as well.

FADEL: NPR's Aya Batrawy in Jeddah, Saudi Arabia.

Thank you so much.

BATRAWY: Thanks, Leila.

(SOUNDBITE OF MUSIC)

FADEL: Tonight at midnight, the contract between the Hollywood writers and major studios will expire.

MARTÍNEZ: They've been negotiating for a new three-year contract, but the Writers Guild of America say their members are prepared to go on strike if their demands aren't met.

FADEL: Joining us to talk about this is NPR's culture correspondent Mandalit del Barco, who's in Los Angeles. Hi, Mandalit.

MANDALIT DEL BARCO, BYLINE: Hi. Good morning.

FADEL: Good morning. So what are the writers asking for?

DEL BARCO: Well, you know, the last time the writers went on strike, it stopped Hollywood production for a hundred days. And that was in 2007. Back then, they were asking for better compensation when their work went on DVDs and internet downloads like iTunes. Now, this time, they're trying to anticipate new technology. They're concerned about the use of AI to create content. And one of the big demands is to get paid more when their work shows up on streamers like Netflix and Amazon. I spoke to Brittani Nichols, who writes for the ABC show "Abbott Elementary." And she told me that between seasons, she used to be able to live off residuals she got when the networks re-aired an episode she wrote. She got half her original writing fee each time. But now, when her episodes are sold to the streamers, she gets just 5.5% of her writing fee.

BRITTANI NICHOLS: You're getting checks for $3, $7, $10. It's not enough to put together any sort of consistent lifestyle. It can really be a real shock because, you know, we get our residuals in these green envelopes. You get a green envelope, you're like, all right, here we go. (Laughter) Hopefully something good's in here. And then sometimes, you just get a stack of checks for 7 cents.

DEL BARCO: Seven whole cents, Leila.

FADEL: (Laughter) Oh, my gosh. So what are the working conditions like for these writers?

DEL BARCO: Well, you know, writers in Hollywood are basically gig workers with a union. They also have to constantly look for their next job. The streaming studios are asking for series that last eight to 10 episodes a season rather than 22 episodes they used to do on network TV. And that means less work and less money for the writers. You know, I talked to some writers, even those on hit shows, who say they're not living some kind of lavish Hollywood dream lifestyle. They're basically broke in between gigs. And here's Brittani Nichols again.

NICHOLS: Though I'm on a job that is pretty good right now, the next job that I have, it could be right back to a really sort of bad situation where I'm again struggling to pay rent. And that shouldn't be the case for someone who's, you know, going to be a decade into their career, who's worked for an Emmy-winning television show. I don't think anyone would look at my career and say, oh, that person still has to worry at this point. But that's just where things are right now.

DEL BARCO: You know, Leila, other TV writers told me that they're basically asked to work for free in what are called mini-rooms, working alone on scripts that may or may not get greenlit, no guarantee they'll be picked up into the official writers room even if the show does get picked up.

FADEL: Now, Mandalit, are the studios saying anything?

DEL BARCO: The CEO of Netflix, Ted Sarandos, told investors that streamers should prepare for a strike. He said Netflix has a large base of upcoming shows and films from around the world. Studio executives have reportedly been stockpiling scripts for months. And if there is a strike, one of the first place viewers might notice it is on late-night TV shows, where the jokes are written that same day. Come tomorrow, writers may be on the picket lines.

FADEL: Mandalit del Barco, NPR's culture correspondent, in Los Angeles.

Thanks so much.

DEL BARCO: Thanks, Leila. Transcript provided by NPR, Copyright NPR.

A Martínez is one of the hosts of Morning Edition and Up First. He came to NPR in 2021 and is based out of NPR West.
Leila Fadel is a national correspondent for NPR based in Los Angeles, covering issues of culture, diversity, and race.