As mentioned in the FDIC statement, On March 27, 2023, the former 17 branches of Silicon Valley Bridge Bank and National Association will be opened as the First Citizens Bank & Trust company.
As per the agreement, First Citizens Bank will soon take over the Silicon Valley Bank and FDIC (Federal Deposit Insurance Corp) has been given equity appreciation rights worth $500 million. Together both parties will share losses and potential recovery loans as per the loss-share agreement.
Also Read: Collapse of SVB: Shock to Financial sector
First Citizen Bank founded in 1898, is based in Raleigh, North Carolina. It has more than 500 branches in 21 states. First Citizen Banks is amongst the biggest buyers in failed US lenders. In 2022, First citizen’s Bank also captured Citigroup, in a deal of more than 2 billion.
As per the Bloomberg report, soon after the collapse of Silicon Valley Bank, FCB was the first to bid and was also active in another sales process by FDIC. Silicon valley bank got seized by US authorities after its fall and is now acquired by its rival First Citizen bank.
Now, depositors of Silicon Valley will become depositors of First Citizens bank. In recent years, FCB has expanded in terms of assets to more than $100 now. Frank B. Holding, Jr. said they have partnered with FDIC to complete more FDIC-related transactions. They value the faith the FDIC has shown in them since 2009.
- Kratika Agarwal