The acquisition of Silicon Valley Bank gives the FDIC shares in First Citizens worth $500 million. Both the FDIC and First Citizens will share in losses and the potential recovery on loans included in a loss-share agreement.
, even those that exceeded the federally insured limit of $250,000, so depositors were able to access their money.a week ago, but the search for a buyer for SVB took longer.
The sale of Silicon Valley Bank involves the sale of all deposits and loans of SVB to First-Citizens Bank and Trust Co., the FDIC said. The acquisition gives the FDIC shares in First Citizens worth $500 million. Both the FDIC and First Citizens will share in losses and the potential recovery on loans included in a loss-share agreement, the FDIC said.
The FDIC will retain about $90 billion of Silicon Valley Bank's $167 billion in total assets, as of March 10, while First Citizens will acquire $72 billion at a discount of $16.5 billion, the FDIC said. It said it estimates Silicon Valley Bank's failure will cost its industry-funded Deposit Insurance Fund about $20 billion.
First Citizens Bank was founded in 1898 and says it has more than $100 billion in total assets, with more than 500 branches in 21 states as well as a nationwide bank. It reported net profit of $243 million in the last quarter. It is one of the top 20 U.S. banks and says it is the largest family-controlled bank in the country.
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