NY Community Bancorp unit agrees to purchase Signature Bank deposits

news7h03/20/2023

10 1 minute read

New York Bancorp Community Flagstar Bank. agreed to purchase Signature Bank which is now closed (NASDAQ:SBNY) deposits and some of its loans.

40 former branches of Signature Bank will operate under the Flagstar of the New York Community Bancorp Banks starting Monday, Federal Deposit Insurance Corporation said in a declare On Sunday night.

The New York State Department of Financial Services already owns Signature Bank (SBNY) Last Sunday to protect depositors. The purchase of Flagstar Bank comes after a Financial Times report on Friday indicated that the FDIC willing to discuss the losses incurred at failed lenders Silicon Valley Bank (SIVB) and Signature Bank (SBNY).

The deal includes the purchase of approximately $38.4 billion in assets of Signature Bridge Bank North America, including $12.9 billion in loans purchased at a discount of $2.7 billion. Approximately $60 billion in loans will remain in the hands of the FDIC for further processing. In addition, the FDIC has received the right to appreciate equity in New York Community Bancorp, Inc., common stock with a potential value of up to $300 million.

Flagstar Bank’s bid does not include approximately $4 billion in deposits related to Signature Bank’s previous digital banking business. The FDIC will offer these deposits directly to customers whose accounts are linked to their digital banking business.

The FDIC estimated the losses resulting from Signature Bank’s failure to its Deposit Insurance Fund to be approximately $2.5 billion. The exact cost will be determined when the FDIC terminates the admission.

Bloomberg reports on potential Flagstar Bank buy signature bank deposit Sunday earlier.

Community Bank of New York (NYSE:NYCB) also came after Bloomberg reported Sunday that the Federal Deposit Insurance Corporation. moving towards parting with Silicon Valley Bank after not being able to find the right person for the entire company.

Bloomberg reported on Saturday that billionaire investor Warren Buffett has been in touch with senior officials in the Biden administration in recent days. related to the regional banking crisis.