SVB Collapse Impact: The state regulators have closed New York-based Signature Bank on Sunday, making it the “third largest failure in US banking history"
Amid Silicon Valley Bank crisis, another bank has fallen prey to the current headwinds in the US Banking sector. As per updates, the state regulators have closed New York-based Signature Bank on Sunday, making it the “third largest failure in US banking history.”
According to a Reuters report, just two days after authorities closed the SVB, billions in deposits also got stranded. Soon after that, the Federal Deposit Insurance Corporation (FDIC) took control of Signature, which had $110.36 billion in assets and $88.59 in deposits at the end of last year.
With the collapse of both Signature Bank and SVB, all depositors of these banks will now reportedly be made whole and no losses will be borne by the taxpayer, the report adds.
The FDIC has now reportedly established a “bridge” successor bank to help customers access their funds. As per updates, the SVB depositors may get access to their money as early as Monday.
The report also mentions that the Signature Bank’s collapse also led employees to gather at the company’s Manhattan headquarters for meetings on Sunday. But as soon as the Signature Bank’s closure news was announced, people left the building, disappointed and shocked.
The SVB collapse comes as a shock to many as one news item related to the bank’s balance sheet, led to investors pulling out their money in a spree. The entire episode led to the bank losing over $80 billion in almost 24 hours and the erosion of more than $100 billion from US banks, in market value.