FDIC’s Purchase of Silicon Valley Bridge Bank Sparks Crypto Debate

FDIC’s Purchase of Silicon Valley Bridge Bank Sparks Crypto Debate

Time Stamp: March 27, 2023 6:39 AM
Source Node: 2035045

SNEAK PEEK

  • First–Citizens Bank & Trust Company has acquired Silicon Valley Bridge Bank, National Association.
  • First–Citizens Bank & Trust Company’s deposits are FDIC-insured up to the maximum.
  • Silicon Valley Bridge Bank, National Association’s $72 billion assets were purchased for $16.5 billion.

A recent report claims that Silicon Valley Bridge Bank National Association was purchased by First-Citizens Bank & Trust Company after the Federal Deposit Insurance Corporation (FDIC) entered into an acquisition and assumption agreement for all deposits and liabilities.

This development has garnered significant media attention, as has the speculative cryptocurrency community, which was significantly affected by SVB`s fall.

However, the acquisition includes 17 former Silicon Valley Bridge Bank and National Association branches, which will open as First–Citizens Bank & Trust Company on March 27, 2023, according to a recent press release by the FDIC. 

Silicon Valley Bridge Bank, National Association customers are urged to stay with their existing branch until they hear from First-Citizens Bank & Trust Company about the system conversions. 

According to the reports, Silicon Valley Bridge Bank National Association customers will immediately become First-Citizens Bank & Trust Corporation customers. First-Citizens Bank & Trust Company will continue to provide FDIC insurance coverage for all deposits up to the insurance threshold.

As part of the agreement, assets owned by Silicon Valley Bridge Bank, National Association, were purchased for about $72 billion at a $16.5 billion discount. Securities and other assets worth a total of $90 billion will continue to remain in receivership for the FDIC to sell.

In addition, First Citizens BancShares, Inc., Raleigh, North Carolina, a joint stock company with a $500 million potential value, granted the FDIC equity appreciation rights in the company. As First-Citizens Bank & Trust Company increases its presence in Silicon Valley and fortifies its position in the financial services sector, this purchase represents a significant turning point for the company.

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