US bank First Citizens will buy “all deposits and loans” from Silicon Valley Bank (SVB), which went bankrupt in early March, the US Federal Deposit Insurance Corporation (FDIC) announced Sunday night.
The transaction affects $72 billion in assets, the FDIC said, adding that “SVB’s 17 branches will open as First Citizens” on Monday.
The bankruptcy of SVB triggered panic in the US banking sector, with repercussions in the European markets. SVB, close to the technology industry, was suddenly in trouble after announcing the sale of 21,000 million dollars in financial securities, with losses of 1,800 million, and its intention to increase capital.
With the bank facing massive withdrawals, authorities declared it insolvent on March 10 and seized control of its assets, making it the largest bank failure in the United States since 2008. At the time, it had $119 billion in assets. deposits, according to the FDIC.
The new entity reopened its doors on March 13 under the name of Silicon Valley Bank Bridge, with a designated manager to run the day-to-day business until its fate is decided.
All of the entity’s loans and deposits will now be managed by First Citizens, while the FDIC will hold some $90 billion in other assets.
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