The Federal Deposit Insurance Corporation (FDIC) has confirmed First Citizens Bank as the new owner of the defunct Silicon Valley Bank (SVB). The new owners purchased SVB in a second auction after making an initial effort to find a buyer.
The FDIC stated in a release that all 17 branches of the former SVB will operate as First Citizens Bank from March 27, 2023. Consequently, all clients of SVB will automatically become customers of First Citizens Bank, and their deposits will be insured by the FDIC to its insurance limit.
Furthermore, SVB customers have been advised to continue using their current branch until they receive notification that all full banking services are now available at First Citizens Bank. According to the details of the purchase, the transaction includes the acquisition of approximately $72 billion in assets from SVB National Association at a $16.5 billion discount.
Meanwhile, about $90 billion in securities and other assets will continue to be under receivership for the FDIC to sell. Recall that the FDIC took charge of both deposits and loans of SVB immediately after the bank was shut down by the California Department of Financial Protection and Innovation on March 10.
Interestingly, the announcement follows after Flagstar Bank acquired non-digital assets and loans of the failed Signature Bank following its collapse.
SVB Customers Records Financial Losses
Following the collapse of the failed SVB, several customers have reported huge amounts of financial exposure to the bank. For instance, Circle, the creator of the USDC stablecoin, has confirmed that $3.3 billion of its reserve is locked up with one of its banking partners.Â
Following confirmation that a portion of its reserves is held in the failed bank, several investors rushed to sell their USDC holdings, while others converted their USDC into fiat currencies or alternative stablecoins.
Similarly, the defunct crypto lender, BlockFi has also confirmed that it has an uninsured $227 million assigned to a money market mutual fund sponsored by SVB.
🔥JOIN THECONRISE.COM'S MONTHLY $1000 GIVEAWAY AND FEEL VALUED AS A READER! DON'T MISS OUT! 🔥
