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New York Community Bancorp unit to buy Signature Bank assets – FDIC

Reuters
New York Community Bancorp unit to buy Signature Bank assets – FDIC

SIGNATURE BANK. A security worker reads a newspaper inside one of the Signature Bank branches in New York City, March 12, 2023.

Eduardo Munoz/Reuters

Flagstar Bank will assume substantially all of Signature Bank's deposits, some of its loan portfolios, and all 40 of its former branches

WASHINGTON, USA – A subsidiary of New York Community Bancorp has entered into an agreement with US regulators to buy deposits and loans from New York-based Signature Bank, which was closed a week ago.

The Federal Deposit Insurance Corporation (FDIC) said the deal would see the subsidiary, Flagstar Bank, assume substantially all of Signature Bank’s deposits, some of its loan portfolios, and all 40 of its former branches. Roughly $60 billion of Signature Bank’s loans and $4 billion of its deposits would remain with it in receivership, the agency said.

The announcement on Sunday, March 19, addresses one of two failed banks the FDIC is holding under receivership.

The statement did not refer to the other, Silicon Valley Bank (SVB), a much larger bank that regulators took over two days before Signature.

Signature had $110.36 billion in assets, whereas SVB had $209 billion.

Reuters reported earlier on Sunday that the FDIC would relaunch its auction for SVB’s assets after failing to attract buyers for the whole bank.

Under the arrangement for Signature Bank assets, Flagstar will buy $12.9 billion of loans at a discount of $2.7 billion.

The FDIC estimated the deal would cost its Deposit Insurance Fund approximately $2.5 billion. The agency previously reported that the fund had held $128.2 billion at the end of 2022. – Rappler.com

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