SPRINGFIELD, Mass. (WWLP) – First Republic Bank is the third and largest bank to fail this year. Failures typically happen when a bank becomes insolvent, meaning it does not have the means to cover all of its customers’ deposits or its debts.

At the first sign of trouble back in March, many clients of First Republic began to pull their money. 22News spoke to local financial expert Mark Teed of Raymond James & Associates who further explained what it means for a bank to “fail.”

“When a bank fails, it generally means that whatever they’ve done with their investment assets or something else has acted on the bank, and the thing fails. So what they’re doing is, most of it has to do with FDIC insurance. As long as you have under a quarter-million dollars, and your money’s in the bank, you’re protected,” said Teed.

The FDIC is the independent regulatory agency of the federal government that oversees banking in the United States. When a bank that’s a member of the FDIC fails, it receives the assets and then has the debts resolved.

In the case of First Republic, as of Monday, all of its deposits and a majority of its assets have been sold to JPMorgan Chase.