New York Bank agrees to buy failed Signature Bank

New York Community Bancorp’s subsidiary has offered to purchase all Signature Bank deposits and loans. Two days after the collapse of Silicon Valley Bank, the institution was bankrupt. The global financial markets are still responding to the largest bank failure since the Great Recession.

Flagstar Bank officially took control of Signature Bank’s 40 branches on March 20, the Federal Deposit Insurance Corp. announced Sunday. Signature Bank customers will have their funds transferred automatically to Flagstar Bank. These deposits are still insured under the FDIC. If your bank is FDIC insured, your deposits will be covered by the federal government up to $250,000 per owner category and institution. )

According to the announcement, Signature had $88.6 Billion in deposits as of December 31, 2022. Flagstar will take over these deposits and $38.4 Billion of Signature’s assets. This includes $12.9 Billion worth of Signature loans at a discount $2.7 billion. Signature is the third-largest bank collapse in America by assets.

Signature ran a digital banking company with $4 billion in deposits. Flagstar did not acquire the business. Instead, the FDIC will distribute these deposits directly to Signature’s customers.

Signature customers can call 866-744-563 with any questions per the announcement. Signature was located in New York City. It operated 30 branches within the New York City metro area, and many along the West Coast.

This deal comes after Silicon Valley Bank’s collapse, which occurred on March 10, following a bank panic. It was the second largest bank failure in U.S. history. The biggest was Washington Mutual’s closing during the 2008 financial crisis. SVB’s collapse sent shockwaves around the world and triggered many financial deals to prevent panic spreading.

In a $3.23 billion deal, UBS, the Swiss bank, agreed to purchase Credit Suisse. The British bank HSBC agreed to buy the British subsidiary of Silicon Valley Bank, while First Republic Bank received a $30 billion deposit injection from 11 U.S. banks giants including JPMorgan Chase and Goldman Sachs.