The US-based First Citizens Bank (FCB), has entered into a purchase and assumption agreement for all deposits and loans of the collapsed Silicon Valley Bank (SVB) valued at $72 billion (€66.9 billion), for a discounted rate of $15.5 billion (€14.4 billion).
According to a statement by the US Federal Deposit Insurance Corporation (FDIC), 17 former branches of SVB will be operated by the buyer, and existing customers will continue to use their current branch until they are informed otherwise by the new owners.
The estimated cost of the failure of SVB to the FDIC deposit insurance fund is estimated to be $20 billion (€18.6 billion), however, the full cost will be determined at a date later.
Approximately $90 billion (€83.7 billion) in securities and other assets previously owned by SVB will still be owned by the FDIC which will still remain “in receivership for disposition by the FDIC.” The FDIC will also receive equity appreciation rights in FCB at a potential value of $500 million (€465 million).
This is the latest sale of assets related to the failed SVB, weeks after its UK branch was sold to HSBC for £1.
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