Valley National and First Citizens Allegedly Fighting for SVB Assets
It is said that two regional banks are competing to buy the failed bank Silicon Valley Bank.
People who know about the situation told Bloomberg News on Saturday, March 25, that First Citizens BancShares and Valley National Bancorp have put in bids with the Federal Deposit Insurance Corp. (FDIC).
Sources say that the FDIC, which took over Silicon Valley Bank (SVB) earlier this month, will choose a new owner as soon as this weekend. PYMNTS has asked both banks for their thoughts, but hasn’t heard back yet.
Recent reports said that Customers Bancorp, based in Pennsylvania, was looking for possible co-investors for a bid to buy SVB, which failed after a run on deposits in one of the biggest bank failures in U.S. history.
The FDIC has been trying to sell SVB. Last week, it said there was “substantial interest” in the bank and gave bidders until the end of the week to send in their offers.
“There has been substantial interest from multiple parties, and the FDIC and the bidders need more time to explore all options in order to maximize value and achieve an optimal outcome,” the FDIC said at the time.
The FDIC sold another failed bank, Signature Bank, to Flagstar Bank, which is a branch of New York Community Bancorp. This happened last week.
The deal was a setback for the cryptocurrency industry, which Signature Bank had once tried to attract, because Flagstar’s bid did not include about $4 billion in deposits tied to the failed bank’s digital banking operations.
“The FDIC will provide these deposits directly to customers whose accounts are associated with the digital banking business,” the FDIC said.
Both the closing of Silvergate Bank, which was done on its own accord, and the failure of Signature Bank have made it harder for crypto services and investors to move traditional currencies. This is because these two banks were important entry points for the digital asset industry.
Signature’s Signet platform was very important to the crypto industry for many years because it made real-time payments possible 24/7, even outside of normal banking hours. However, the FDIC is still in charge of the platform, and a new plan will be made later. It’s not clear if the platform will ever be back online as a regular service.
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