Bear Stearns was the U.S. investment bank whose 2008 rescue by JPMorgan Chase became an early milestone of the global financial crisis.
Bear Stearns had been heavily involved in mortgage-backed securities and related products. As the U.S. housing market deteriorated, investors questioned the value of those assets and the firm’s ability to obtain short-term financing. In March 2008, a rapid loss of confidence created a liquidity crisis.
JPMorgan Chase agreed to acquire Bear Stearns with support from the Federal Reserve Bank of New York. The deal was initially announced at $2 per share and later increased to $10 per share. The Federal Reserve provided financing for a portfolio of troubled assets connected to the transaction.
The rescue was intended to prevent a disorderly failure and limit contagion across financial markets. It did not end the crisis: Lehman Brothers failed six months later, while other institutions required support. Bear Stearns therefore stands as an early warning that mortgage-related losses had become a threat to major financial firms.