In a move that is expected to help minimize disruptions for customers of Silicon Valley Bridge Bank, National Association, the Federal Deposit Insurance Corporation (FDIC) has entered into a purchase and assumption agreement with First–Citizens Bank & Trust Company, based in Raleigh, North Carolina, for all deposits and loans of the Silicon Valley-based bank.

This agreement will see the 17 branches of Silicon Valley Bridge Bank, National Association open as First–Citizens Bank & Trust Company on Monday, March 27, 2023.

Under the agreement, depositors of Silicon Valley Bridge Bank, National Association, will automatically become depositors of First–Citizens Bank & Trust Company, and all deposits assumed by First–Citizens Bank & Trust Company will continue to be insured by the FDIC up to the insurance limit.

As of March 10, 2023, Silicon Valley Bridge Bank, National Association, had approximately $167 billion in total assets and about $119 billion in total deposits. The purchase by First–Citizens Bank & Trust Company included the acquisition of about $72 billion of Silicon Valley Bridge Bank, National Association’s assets at a discount of $16.5 billion. Approximately $90 billion in securities and other assets will remain in the receivership for disposition by the FDIC.

In addition to the purchase and assumption agreement, the FDIC and First–Citizens Bank & Trust Company entered into a loss–share transaction on the commercial loans that were purchased. The loss–share transaction is projected to maximize recoveries on the assets by keeping them in the private sector and is also expected to minimize disruptions for loan customers. First–Citizens Bank & Trust Company will assume all loan–related Qualified Financial Contracts.

The FDIC estimates the cost of the failure of Silicon Valley Bank to its Deposit Insurance Fund (DIF) to be approximately $20 billion. The exact cost will be determined when the FDIC terminates the receivership. Silicon Valley Bridge Bank, National Association, was created by the FDIC following the closure of Silicon Valley Bank by the California Department of Financial Protection and Innovation. All deposits and assets, including Qualified Financial Contracts, of Silicon Valley Bank were transferred to the bridge bank.

#SVB #SVBBank #FDIC #crypto2023 #azcoinnews

This article was republished from azcoinnews.com

In a hearing held by the U.S. House of Representatives, Federal Deposit Insurance Corporation (FDIC) Chairman Martin Gruenberg testified that approximately $4 billion in deposits related to cryptocurrency businesses of the failed Signature Bank would be returned to depositors by early April.

The FDIC announced that New York Community Bancorp (NYCB) would acquire some of Signature Bank’s deposits and assets, excluding the crypto-related assets, which would be returned to depositors. Customers holding funds in Signature Banks will be contacted by the FDIC and have until April 5 to transfer their assets or accept account closure measures.

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Gruenberg clarified that the decision not to include cryptocurrency-related assets in the acquisition was the choice of NYCB, the winning bidder. Republican Rep. Tom Emmer, a well-known cryptocurrency advocate, expressed his interest in confirming the sale of Signet, a payment network dedicated to Signature Bank’s cryptocurrency clients, as it is an asset of great value.

The closure of Signature Bank by the New York State Department of Financial Services (NYDFS) to avoid a financial system crisis after the failure of Silicon Valley Bank (SVB) has been criticized by former Republican congressman Barney Frank and Ryan Selkis, founder of blockchain analytics firm Messari.

They accused regulators of targeting Signature Bank to show their opposition to virtual currencies. However, Treasury Undersecretary for Domestic Finance Nellie Liang testified that she did not believe cryptocurrencies played a direct role in the collapse of Signature Bank and SVB.

The acquisition of SVB by First Citizens Bank included all assets, including cryptocurrency-related deposits. Gruenberg denied Emmer’s claim that the FDIC might increase scrutiny of retaining or taking on new cryptocurrency customers.

Overall, the testimony given by the regulators shed light on the handling of bank failures and the role of cryptocurrency-related assets in the collapse of banks. It remains to be seen how the sale of Signet will impact the crypto industry and if any further scrutiny will be imposed on retaining or taking on new cryptocurrency customers.

#FDIC #crypto2023 #bitcoin #BTC #azcoinnews

This article was republished from azcoinnews.com

To safeguard all depositors at #SVB in Santa Clara, California, the Federal Deposit Insurance Corporation (FDIC) has taken action. All deposits, both insured and uninsured, and nearly all assets have been moved to a brand-new, fully functional "bridge bank" run by the FDIC.

This morning, the brand-new #SiliconValley Bank, N.A., will reopen and resume regular banking operations, including online banking. Customers of Silicon Valley Bank, N.A. will automatically include depositors and borrowers. and have check writing, ATM, and debit card access to their money. The transfer of all deposits was completed under the systemic risk exception allowed on March 12, 2023.

Tim Mayopoulos was appointed CEO of Silicon Valley Bank, N.A. by the FDIC. He previously held the positions of president of Blend Laboratories, Inc. and president and CEO of the Federal National Mortgage Association. This will enhance recoveries for creditors and the Deposit Insurance Fund, safeguard depositors, and maintain the value of Silicon Valley Bank's assets and operations (DIF).

The purpose of the bridge bank structure is to "bridge" the time between a bank's failure and the point at which the #FDIC can stabilize the organization and put an orderly resolution in place. Senior management has been fired, and holders of some unsecured debt will not be protected. A special assessment on banks will be used to recoup any losses to the DIF from supporting uninsured depositors, as required by law.

All Qualified Financial Contracts of the defunct bank were also transferred to the bridge bank by the receiver for Silicon Valley Bank. By taking this step, depositors will be guaranteed complete access to their funds and be shielded from any damages resulting from Silicon Valley Bank's bankruptcy.

In a recent development in the banking industry, the Federal Deposit Insurance Corporation (FDIC) has entered into a purchase and assumption agreement for substantially all deposits and certain loan portfolios of Signature Bridge Bank, National Association, by Flagstar Bank, National Association, a wholly owned subsidiary of New York Community Bancorp, Inc.

This acquisition was completed on Monday, March 20, 2023, with the 40 former branches of Signature Bank set to operate under New York Community Bancorp’s Flagstar Bank, N.A.

Depositors of Signature Bridge Bank, N.A., other than cash depositors related to the digital-asset banking businesses, will automatically become depositors of the assuming institution. All deposits assumed by Flagstar Bank, N.A., will continue to be insured by the FDIC up to the insurance limit. The FDIC estimates the cost of the failure of Signature Bank to its Deposit Insurance Fund to be approximately $2.5 billion. The exact cost will be determined when the FDIC terminates the receivership.

This acquisition was necessitated by the closure of Signature Bank, New York, New York, by the New York State Department of Financial Services. Signature Bridge Bank, N.A. was created by the FDIC on March 12, 2023, to take over the operations of Signature Bank.

As of December 31, 2022, the former Signature Bank had total deposits of $88.6 billion and total assets of $110.4 billion. Today’s transaction included the purchase of about $38.4 billion of Signature Bridge Bank, N.A.’s assets, including loans of $12.9 billion purchased at a discount of $2.7 billion. Approximately $60 billion in loans will remain in the receivership for later disposition by the FDIC.

The acquisition by Flagstar Bank, N.A. did not include approximately $4 billion of deposits related to the former Signature Bank’s digital-assets banking business. The FDIC will provide these deposits directly to customers whose accounts are associated with the digital-asset banking businesses. Questions may be directed to (866) 744-5463.

As part of the agreement, the FDIC received equity appreciation rights in New York Community Bancorp, Inc. common stock with a potential value of up to $300 million. This acquisition has put the FDIC in a better position to manage the receivership of Signature Bank and recover some of the costs incurred by the failure of the bank.

The acquiring institution, Flagstar Bank, N.A., has assured customers of Signature Bridge Bank, N.A. that their banking services will not be disrupted and that they should continue to use their current branch until they receive notice from the assuming institution that full-service banking is available at branches of Flagstar Bank, N.A. This acquisition has put the FDIC in a better position to manage the receivership of Signature Bank and recover some of the costs incurred by the failure of the bank.

#FDIC #SignatureBank #Flagstar #SVB #azcoinnews

This article was republished from azcoinnews.com

The #SVB and #SignatureBank bid deadline has been set by the #FDIC on March 17. Buyers must discontinue any cryptocurrency-related business.

Financial institutions interested in purchasing Silicon Valley Bank and Signature Bank before they go out of business have until Friday, March 17, according to FDIC officials.

Selling Silicon Valley Bank and Signature Bank completely is the aim. Consider selling some of the shares of the two banks if you can't sell it all.

To provide donors an advantage over private equity firms, only bidders with active bank charters are permitted to review banks' financials before submitting their offers.

According to rumors, the buyer of Signature Bank will have to consent to giving up all of the bank's cryptocurrency operations.

Regulators have highlighted that Signature Bank's closure is due to a crisis of confidence in its management, not connection with #cryptocurrency startups, despite the bank's reputation as one of two crypto-friendly banks. Its leadership nevertheless views it as a campaign to stop banks from working with cryptocurrency service providers.

Silicon Valley Bank, Signature Bank, and Piper Sandler, the company in charge of the auction, all promptly reacted to demands for comment, but the FDIC declined to speak on its behalf.

After authorities took over Silicon Valley Bank (SVB) on Friday and Signature Bank (SBNY.O) on Sunday, in a turbulent weekend that rippled throughout the whole global financial system, the latest auctions demonstrate how the FDIC is working in tandem to return lenders to the private sector.