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On March 27, 2023, First Citizens Bank made a declaration that this US giant has obtained all the deposits and loans of Silicon Valley Bank (SVC). First Citizens Bank, a subordinate of First Citizen BancShares, Inc. collaborated with the Federal Deposit Insurance Corporation (FDIC) in order to buy all loans, assets, customer deposits and various liabilities of Silicon Valley Bridge Bank, National Association.
First Citizens Bank acquires Silicon Valley Bridge Bank, N.A. This transaction supports Silicon Valley Bank depositors and borrowers, and it helps strengthen the U.S. banking system and economy. https://t.co/aguYXmnNxB pic.twitter.com/nYIN0T6f8b
— First Citizens Bank (@firstcitizens)
March 27, 2023
This deal has been made to support depositors and borrowers of Silicon Valley Bank. The transaction is about acquiring most of the businesses including loss share coverage. First Citizens was asked to finalize the transaction through a challenging bidding process.
Frank B. Holding, the Jr Chairman and CEO of First Citizens stated that First Citizens is widely renowned for its financial strength, exceptional customer service and wise lending for over 125 years.
Transaction Details
The purchasing deal is of $119 billion of deposits while $72 billion are loans which have been done at a discount of $16.5 billion. The offer was put forward immediately after SVB collapsed significantly. Silicon Valley Bridge Bank, National Association carries a total of $167 billion of assets and deposits are worth $119 billion according to March 10, 2023.
The Federal Reserve data reveals that First Citizens was regarded as the 30th largest commercial bank in the United States in terms of its assets at the end of 2022. Moreover, First Citizens Bancshares, Inc. is titled one of the giants across the country. This financial institution is headquartered in Raleigh, North Carolina, US.
About First Citizens Bank
The bank has over 500 branches that are placed across 22 US states. The company becomes one of the biggest investors that have bought failed US lenders. It has acquired more than 35 banks in the US since 1971.
Talking about the accumulation of assets, First Citizens holds $109 billion in assets whereas $89.4 billion are the total amount of deposits. Last year, First Citizens was the 30th largest commercial bank in the US as per assets. In 2022, it superseded CIT Group Inc. in a deal which was made at a value of about $2 billion.
Banking Operations
It was announced that there will be no change to customers’ current bank accounts and they can continue to retrieve their accounts as they used to do earlier. This will be done through customers’ current websites, mobile apps and branch locations.
Align with this, access will be similar to what was provided earlier like they can check and use cards and will still have ATMs and other online facilities to reach their accounts. Loan customers are also advised to continue making loan payments as usual. Customers will receive notifications of all future account changes in advance.
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