New York Community Bancorp unit to buy Signature Bank assets, FDIC says

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Signature Bank headquarter, in New York
A person walks into the lobby of the Signature Bank headquarters, in New York City, U.S., March 13, 2023. REUTERS/David 'Dee' Delgado/File Photo

WASHINGTON, March 19 (Reuters) - A subsidiary of New York Community Bancorp (NYCB.N) has entered into an agreement with U.S. regulators to buy deposits and loans from New York-based Signature Bank (SBNY.O), which was closed a week ago.

The Federal Deposit Insurance Corporation (FDIC) said the deal would see the subsidiary, Flagstar Bank, assume substantially all of Signature Bank's deposits, some of its loan portfolios and all 40 of its former branches. Roughly $60 billion of Signature Bank's loans and $4 billion of its deposits would remain with it in receivership, the agency said.

The Sunday announcement addresses one of two failed banks the FDIC is holding under receivership.

The statement did not refer to the other, Silicon Valley Bank (SVB) , a much larger bank that regulators took over two days before Signature.

Signature had $110.36 billion in assets, whereas SVB had $209 billion.

Reuters reported earlier on Sunday that the FDIC would relaunch its auction for SVB's assets after failing to attract buyers for the whole bank.

Under the arrangement for Signature Bank assets, Flagstar will buy $12.9 billion of loans at a discount of $2.7 billion.

The FDIC estimated the deal would cost its Deposit Insurance Fund approximately $2.5 billion. The agency previously reported that the fund had held $128.2 billion at the end of 2022.

Reporting by Pete Schroeder; Editing by Christopher Cushing and Bradley Perrett

Our Standards: The Thomson Reuters Trust Principles.

Thomson Reuters

Covers financial regulation and policy out of the Reuters Washington bureau, with a specific focus on banking regulators. Has covered economic and financial policy in the U.S. capital for 15 years. Previous experience includes roles at The Hill newspaper and The Wall Street Journal. Received a Master's degree in journalism from Georgetown University, and an undergraduate degree from the University of Notre Dame.

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