First Citizens Bank has agreed to buy parts of Silicon Valley Bank (SVB) more than two weeks after U.S. regulators took over the troubled bank.
After acquiring all of SVB's deposits, loans, and branches, First Citizens will become one of the 25 largest U.S. banks.
- First Citizens, a major regional bank headquartered in Raleigh, North Carolina, will acquire $56.5B in deposits and ~$72B in loans for a discounted price of $16.5B.
- The Federal Deposit Insurance Corp. (FDIC) will help finance the deal with a five-year $35B loan and provide a $70B line of credit to cover possible deposit flight.
- Approximately ~$90B of SVB's securities will stay in receivership.
- SVB branches are set to re-open on Monday under First Citizens' ownership.
Zoom Out:
- The collapse and regulatory takeover of SVB and Signature Bank earlier this month were two of the biggest bank failures in U.S. history.
- Last week the FDIC said it had sold "substantially all" of Signature Bank's deposits and some of its loans to a unit of New York Community Bancorp.
