First Citizens Bank agreed to purchase the deposits and loans of Silicon Valley Bank, the U.S. Federal Deposit Insurance Corporation announced on Monday.
About $90 billion in securities and other assets would stay “in receivership for disposition by the FDIC,” while another $72 billion will be purchased at a discount of $16.5 billion.
As part of the deal, the FDIC “received equity appreciation rights in First Citizens BancShares, Inc., Raleigh, North Carolina, common stock with a potential value of up to $500 million,” according to the statement.
Earlier this month, the regulator moved all SVB savings and assets to a new “bridge bank” to safeguard SVB depositors.
“The 17 former branches of Silicon Valley Bridge Bank, National Association, will open as First–Citizens Bank & Trust Company on Monday, March 27, 2023,”according to the statement on Monday.
“Customers of Silicon Valley Bridge Bank, National Association, should continue to use their current branch until they receive notice from First–Citizens Bank & Trust Company that systems conversions have been completed to allow full–service banking at all of its other branch locations.”
First Citizens has approximately $109 billion in assets and $89.4 billion in total deposits.
Both SVB Private and Silicon Valley Bank had been on the market for sale by the FDIC for the previous two weekends, but no agreement could be reached. Since then, it has requested separate bids for SVB Private and Silicon Valley Bank by March 24.
