Silicon Valley Bank Crisis: Sold the bankrupt Silicon Valley Bank, bought by First Citizen Bank
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The Raleigh, North Carolina-based bank entered into a purchase and assumption agreement for all of SVB’s deposits and loans, according to a statement from the Federal Deposit Insurance Corp. The deal includes the purchase of approximately $72 billion of SVB assets at a discount of $16.5 billion.
America’s Silicon Valley Bank was surrounded by financial crisis and now a new news is coming about it. The US firm has acquired Silicon Valley Bank after it went bankrupt. To get the bank out of financial trouble, First Citizens Bankshare Inc. bought it from the Federal Deposit Insurance Corporation. The Raleigh, North Carolina-based bank entered into a purchase and assumption agreement for all of SVB’s deposits and loans, according to a statement from the Federal Deposit Insurance Corp. The deal includes the purchase of approximately $72 billion of SVB assets at a discount of $16.5 billion.
About $90 billion in securities and other assets will remain in receivership for disposal by the Federal Deposit Insurance Corporation, while the federal institution also received equity appreciation rights for up to $500 million in First Citizens. The estimated cost of the Deposit Insurance Fund failure is about $20 billion, although the exact extent will be determined when receivership ends, according to the statement.
First Citizens CEO Frank Holding Jr. said in a statement that this has been a remarkable transaction in partnership with the FDIC that should instill confidence in the banking system. Let us tell you that Silicon Valley Bank was the 16th largest bank in America. The responsibility of keeping the money of the customers safe was also given. After the collapse of this bank, the Federal Deposit Insurance Corporation was appointed its receiver. In view of this, a team was also constituted by the Federal Deposit Insurance Corporation.
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