An affiliate of First Citizens BancShares, First Citizens Bank & Trust Corporation, announced the acquisition of troubled Silicon Valley Bank (SVB), now known as Silicon Valley Bridge Bank, N.A.
The announcement states that First Citizens would take over all user deposits. In addition, some liabilities, and a significant portion of SVB’s loans after the release from FDIC receivership.
SVB’s US$ 110 billion in assets, US$ 56 billion in deposits, and US$ 72 billion in loans will transfer to First Citizens Bank. Additionally, the FDIC will give First Citizens Bank access to a line of credit available for unforeseen liquidity needs.
According to the release, First Citizens was chosen to complete this transaction after a competitive bidding process. Additionally, the FDIC will continue to be in possession of securities and other assets worth a total of US$ 90 billion.
About the Purchase
First Citizens Bank and the FDIC have shared a loss-sharing agreement. First Citizens Bank will not purchase any SVB Financial Group assets, common stock, preferred stock, debt, or other commitments from the company.
Also Read: https://thecitizenscoop.com/hsbc-today-announces-the-acquisition-of-silicon-valley-bank/
First Citizens’ chairman and CEO, Frank B. Holding Jr., said: “First Citizens has a 125-year history of financial stability, outstanding client care, and responsible lending. Since 2009, we and the FDIC have successfully completed more FDIC-assisted transactions than any other bank. In addition, we are grateful for the FDIC’s renewed trust in us.
The operation of First Citizens Bank
Beginning on March 27, 2023, the 17 former Silicon Valley Bridge Bank, N.A. zones will operate as First Citizens Bank. Until further notice, users can still access their present accounts.
The FDIC received First Citizens BancShares common stock in exchange for equity appreciation rights that have a maximum value of $500 million. First-Citizens Bank & Trust Company will continue to provide FDIC insurance coverage for all deposits up to the insurance capital.
