The US Federal Deposit Insurance Corporation said that the North Carolina-based First Citizens Bank would buy all deposits and loans of Silicon Valley Bank (SVB), whose recent collapse raised concerns about the health of the global banking and financial sector
MOSCOW (Pakistan Point News / Sputnik - 27th March, 2023) The US Federal Deposit Insurance Corporation said that the North Carolina-based First Citizens Bank would buy all deposits and loans of Silicon Valley Bank (SVB), whose recent collapse raised concerns about the health of the global banking and financial sector.
"The Federal Deposit Insurance Corporation (FDIC) entered into a purchase and assumption agreement for all deposits and loans of Silicon Valley Bridge Bank, National Association, by First-Citizens Bank & Trust Company, Raleigh, North Carolina," the regulator said on Sunday.
Silicon Valley Bridge Bank was created by the FDIC earlier in March as SVB's asset transferee "to allow time for the FDIC to stabilize the institution and market the franchise." According to the statement, 17 former Silicon Valley Bridge Bank branches will open as divisions of First-Citizens Bank on Monday.
The FDIC and First-Citizens Bank will share potential losses and refunds on Silicon Valley Bank loans., which is expected to minimize disruption to borrower customers, the statement read. As of March 10, Silicon Valley Bridge Bank had about $167 billion in assets and $119 billion in deposits, according to the FDIC.
Following the FDIC announcement, the value of the US dollar against other major world currencies, such as the euro and yen, started to climb, trading data showed on Monday morning, suggesting that the investor worries caused by the collapse of several banks in the US are easing somewhat.
As of 06:33 GMT, the euro-dollar exchange rate was down to $1.0753 from the previous close of $1.0759, while the dollar-yen exchange rate rose to 131.20 yen from 130.69 yen. Meanwhile, the US Dollar +Index (used to measure the value of the dollar against a basket of six foreign currencies) was up 0.08% to 103.2 points.
On March 10, federal regulators seized Silicon Valley Bank - the largest US bank to collapse since the 2008 financial crisis and the second largest implosion in the country's history. Two days later, the New York-based Signature Bank was seized in the third largest bank collapse in US history.
