FDIC offloads non-crypto Signature Bank deposits to Flagstar Bank
New York Community Bancorp subsidiary Flagstar Bank is set to acquire certain assets and liabilities from recently shuttered Signature Bank from the Federal Deposit Insurance Corporation (FDIC).
FDIC offloads non-crypto assets of Signature Bridge Bank
Flagstar will acquire $38 billion worth of assets from the FDIC-controlled banking outfit, now known as Signature Bridge Bank, including cash reserves of around $25 billion and $13 billion in loans. The deal also includes assumed liabilities of around $36 billion, including deposits of around $34 billion.
Flagstar has also picked up Signature’s wealth management and broker-dealer business and will take over the bank’s 40 former branches.
The firm did not acquire any digital asset banking or crypto-related assets or deposits, nor did it acquire loans or deposits related to Signature Bank’s fund banking business.
The FDIC will provide crypto-related deposits directly to customers.
Depositors of Signature Bridge Bank, other than cash depositors related to the digital asset banking businesses, will automatically become depositors of the assuming institution, the FDIC says.
New York Community Bancorp says it intends to leverage its “significant liquidity position” to pay down much of Signature’s wholesale borrowings, “leaving the balance sheet in an even stronger cash position”.
The company’s president and CEO, Thoma Cangemi, says the acquisition supports the firm’s move towards becoming a diversified full-service commercial bank, set in motion by the merger of New York Community and Flagstar.
“The deal is expected to significantly strengthen our deposit base, lower the loan-to-deposit ratio, provide the opportunity to pay down a substantial amount of our wholesale funding, and further diversify our loan portfolio away from CRE loans and more toward commercial loans,” Cangemi adds.
