As Silicon Valley Bank (SVB), which triggered the U.S. banking crisis, finds a new owner which is the First Citizens Bank, expectations are rising that the financial market will stabilize. However, some analysts say that market concerns remain as concerns over insolvency that have spread to U.S. local banks and global banks have not yet been extinguished.
According to the Wall Street Journal (WSJ) on the 26th (local time), the U.S. Federal Deposit Insurance Corporation (FDIC) said in a statement that First Citizens Bank has agreed to acquire all loans, deposits and branches of SVB.
First Citizens will acquire $72 billion of assets held by SVB for $16.5 billion. SVB’s $90 billion worth of securities will remain under court receivership.
On the 10th, the California Financial Protection Innovation Administration closed SVB, which had been unable to pay, and appointed the U.S. Federal Deposit Insurance Corporation (FDIC) as a bankruptcy trustee. FDIC established a corporation called “Santa Clara Deposit Insurance National Bank” to transfer SVB’s assets.
SVB’s bankruptcy is the second largest in U.S. history after Washington Mutual, which collapsed during the 2008 global financial crisis.
FDIC began the auction process for SVB assets on the 11th, but it ended without results. Large banks did not bid, and one expressed its intention to take over, but FDIC reportedly refused.
In the subsequent sale process, First Citizens was decided as the buyer. First Citizens and Valley National Bancorp participated in the sale bid that closed on the 24th, and First Citizens won.
First Citizens is a small and medium – sized bank based in Raleigh, North Carolina. As of 2022, it is the 30th largest commercial bank in the United States with a total asset of USD 109.3 billion. With the acquisition of SVB on the same day, it was ranked in the top 25 by assets.
