First-Citizens Bank, a subsidiary of First Citizens BancShares, has agreed to acquire Silicon Valley Bridge Bank from Federal Deposit Insurance Corporation (FDIC).
The deal includes all the loans and certain other assets, along with all customer deposits and certain other liabilities of Silicon Valley Bridge Bank.
First Citizens Bank was selected for the transaction, which is structured as a whole bank purchase with loss share coverage, through a competitive bidding process.
It will assume Silicon Valley Bridge Bank assets of $110bn, deposits of $56bn and loans of $72bn, based on FDIC’s latest information.
It will receive the additional line of credit from the FDIC for contingent liquidity purposes.
In addition, First Citizens Bank signed a loss share agreement with the FDIC to enable additional downside protection against potential credit losses.
First Citizens chairman and CEO Frank B Holding Jr. said: “First Citizens has a reputation for financial strength, exceptional customer service and prudent lending that spans 125 years.
“We have partnered with the FDIC to successfully complete more FDIC-assisted transactions since 2009 than any other bank, and we appreciate the confidence the FDIC has placed in us once again.
“We look forward to building relationships with our new customers and positioning our company for continued success as we affirm our commitment to support the integrity of our nation’s banking system.”
First Citizens Bank said that it will not acquire any of the assets or assume any other obligations of SVB Financial Group, the former holding company of Silicon Valley Bank (SVB).
Earlier this month, the California Department of Financial Protection and Innovation (DFPI) shut down SVB, after a swift collapse.
DFPI seized SVB under the California Financial Code section 592 and placed the bank under the receivership of the FDIC.
First Citizens Bank will start operating 17 legacy Silicon Valley Bridge Bank branches, under the brand name Silicon Valley Bank, a division of First Citizens Bank.
Holding added: “First Citizens has a proud history of growing organically and through strategic acquisitions that build our core capabilities in a careful and deliberate manner.
“This transaction leverages our solid foundation to add significant scale, geographic diversity, compelling digital capabilities and most importantly, meaningful solutions for customers throughout their lifecycle.
“Specifically, we are committed to building on and preserving the strong relationships that legacy SVB’s Global Fund Banking business has with private equity and venture capital firms.”
