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WORLD NEWS | New York Community Bank to take over failed Signature Bank

Streaks of light seen in California. (Image source: video capture)

NEW YORK, March 20 (AP) – The Federal Deposit Insurance Corporation said late Sunday that New York Community Bank has agreed to buy a majority stake in defunct Signature Bank for $2.7 billion.

From Monday, 40 branches of Signature Bank will be renamed Flagstar Bank.

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Flagstar is a subsidiary of New York Community Bank.

The deal would include buying $38.4 billion worth of Signature Bank’s assets, a little more than a third of what Signature Bank had when it collapsed a week ago.

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The FDIC said $60 billion in loans from Signature Bank will remain in receivership and are expected to be sold in time.

Signature Bank is the second bank to fail in the banking crisis, about 48 hours after Silicon Valley Bank collapsed. Signature, based in New York, is a large commercial bank in the tri-state area but has embraced cryptocurrencies as a potential growth business in recent years.

After the collapse of Silicon Valley Bank, depositors became concerned about the health of Signature Bank because of its large number of uninsured deposits and its exposure to cryptocurrencies and other tech-focused loans. By the time it was shut down by regulators, Signature had become the third-largest bank to fail in U.S. history.

The FDIC said it expects Signature Bank to miss $2.5 billion in losses to the deposit insurance fund, but that figure could change as the regulator sells assets. The deposit insurance fund is paid through assessments of banks, and the taxpayer does not bear the direct costs of a bank failure. (Associated Press)

(This is an unedited and auto-generated story from a Syndicated News feed, the content body may not have been modified or edited by LatestLY staff)

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