A unit of New York-based New York Community Bancorp has agreed to purchase and assume all deposits and certain loan portfolios of Signature Bridge Bank, which was created last week by the Federal Deposit Insurance Corporation (FDIC) to replace failed Signature Bank, the agency said on Sunday.
See related article: Circle’s Disparte speaks on de-risking crypto from banking risks
Fast facts
- Starting on Monday, the 40 former branches of Signature Bank will operate under Flagstar Bank, a subsidiary of New York Community Bancorp, according to the statement.
- The deal, however, did not include the US$4 billion deposits related to Signature Bank’s digital banking business and the FDIC will continue providing access to these deposits to the bank’s customers with accounts linked to the digital banking business.
- The purchase agreement came after U.S. regulators closed down Signature Bank on March 12 with the FDIC taking over the lender.
- The fall of Signature Bank followed the collapse of California-based and crypto-linked bank Silvergate Capital earlier this month and the March 12 closure of Silicon Valley Bank, which at one point caused Circle’s USDC stablecoin to lose its peg to the U.S. dollar.
- In an interview with Forkast last week, Circle Chief Strategy Officer Dante Disparte said the recent U.S. banks fallout is a “stress test” for both traditional finance and digital assets, but “to weather the storm side by side is a powerful opportunity.”
See related article: Who should be held responsible for the Silvergate Bank and SVB crises?
