First Citizens To Acquire Silicon Valley Bank

First Citizens has agreed to buy a $72 billion chunk of Silicon Valley Bridge Bank, the California lender formerly known as Silicon Valley Bank that was taken over by the FDIC two weeks ago after depositors, in a crisis of confidence, made a run on it. SVB served as lifeblood to thousands of startups before its collapse, the biggest in U.S. banking in years, sent shockwaves through the financial sector. From a report: Seventeen former branches of Silicon Valley Bank will open as First Citizens Bank later today, the FDIC said. The U.S. Federal Deposit Insurance Corporation said in a statement that it estimates the failure will cost its Deposit Insurance Fund about $20 billion. It will provide an exact figure when the deal and FDIC receivership conclude. There is significant money at stake here, but with depositors and confidence continuing to be shaky, it's taken weeks to get a deal done and each passing day has arguably devalued the assets a little bit. The FDIC has previously run two unsuccessful auction processes for Silicon Valley Bridge Bank, as it had to modify what it was selling, including breaking up the assets. This deal with First Citizens includes purchase deposits and loans, worth about $72 billion, at a discount of $16.5 billion.

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