First Citizens to acquire Silicon Valley Bank

First Citizens BankShares has agreed to buy Silicon Valley Bank, the California lender that served as lifeblood of thousands of startups and whose collapse sent shockwaves through the financial sector, the Federal Deposit Insurance Corporation said on Monday.

The deal includes the purchase of about $72 billion assets of Silicon Valley Bank at a discount of $16.5 billion. About $90 billion in securities and other assets of the California-based lenders will remain “in receivership of disposition” by the U.S. Federal Deposit Insurance Corporation.

The announcement comes weeks after the FDIC seized control of Silicon Valley Bank on March 10 after a run on deposits made the lender insolvent. The 17 former branches of Silicon Valley Bank will open as First Citizens Bank on Monday, the FDIC said.

“In addition, the FDIC received equity appreciation rights in First Citizens BancShares, Inc., Raleigh, North Carolina, common stock with a potential value of up to $500 million,” the FDIC said in a statement.

Before the collapse, the Silicon Valley Bank was the 16th largest bank in the U.S. Its meltdown was the largest bank failure in the U.S. since the 2008 financial crisis.

More to follow.

First Citizens to acquire Silicon Valley Bank by Manish Singh originally published on TechCrunch