The U.S. financial authorities have decided to split and sell the closed Silicon Valley Bank (SVB) by business sector, and U.S. small and medium-sized bank First Citizens Bank Shares (hereinafter referred to as First Citizens), which is mentioned as a candidate for SVB acquisition, is reportedly seeking to acquire it.
According to Reuters and Bloomberg on the 20th (local time), the U.S. Federal Deposit Insurance Corporation (FDIC), SVB’s bankruptcy trustee, decided to sell SVB divided into deposit and asset management units after failing to sell last week.
FDIC plans to receive bids for “Silicon Valley Private Bank,” SVB’s asset management division for the wealthy, by the 22nd and for other divisions by the 24th.
Sources said First Citizens, which has a lot of experience in acquiring bankrupt financial institutions, still wants to acquire the entire SVB, and it is expected to bid here as well when it is sold in installments.
While First Citizens declined to comment, saying, “We do not comment on market rumors or speculations,” the company’s stock price, which fell 33% this year, soared 10.47% on the same day.
However, Bloomberg said that some in the market have doubts about the availability of acquisition funds as First Citizens’ assets are only 30th among U.S. commercial banks as of the end of 2022.
After the recent liquidity problem, SVB collapsed as more than 40 billion dollars was withdrawn in a day due to bank runs by start-ups and other depositors. SVB bankruptcy is the second largest in the history of U.S. banks.
Since then, authorities such as the U.S. Treasury Department, the Federal Reserve System (Fed), and the FDIC have hurriedly come up with measures to protect all SVB deposits to prevent the spread of the crisis.
On the 12th, two days after the collapse of SVB, the signature bank in New York State was also closed, and after Swiss investment bank Credit Suisse was sold to UBS, SVB Financial Group, the parent company of SVB, eventually filed for bankruptcy protection to the U.S. authorities and is looking for a buyer.
Meanwhile, U.S. bank New York Community Bancorp said its subsidiary Flagstar Bank acquired some of the assets of Signature Bank.
Flagstar bought $38 billion worth of signature bank assets and took on $36 billion worth of debt, while also acquiring all branches. However, digital assets such as virtual currency were excluded from the acquisition.