A subsidiary of New York Community Bancorp has agreed to acquire Signature Bank, the Federal Deposit Insurance Corporation said.
El Flagstar Bank de Hicksville, New York will acquire “substantially all of Signature’s deposit and certain loan portfolios,” the FDIC said in a statement Sunday. Signature’s 40 branches will operate as Flagstar locations beginning Monday, March 20.
US prosecutors were investigating New York-based Signature Bank’s work with crypto clients before regulators lost faith in the management and swooped in this month to seize the lender, along with Silicon Valley Bank.
The failures of those two companies, as well as the collapse days before Silvergate Capitalanother crypto lender, stoked concerns about spillover effects for other regional lenders and the broader economy.
Like Silicon Valley Bank, with clients made up almost entirely of businesses, Signature had a deposit base that was largely uninsured. That may have attracted the attention of regulators investigating the stability of banks with large uninsured deposit bases.
The FDIC had transferred all of Signature Bank’s deposits and substantially all of the company’s assets to Signature Bridge Bank prior to the Flagstar settlement.
El New York Community Bancorp acquired Flagstar last year for about $2.6 billion.
“NYCB and Signature have similar strategies and culture, as well as overlap in commercial real estate,” Bloomberg Intelligence analysts Herman Chan and Sergio Ferreira said in a research note Sunday before the announcement.
financial control agencies and Justice Department officials They have repeatedly warned that companies that handle cryptocurrency, or related cash, must be vigilant in identifying customers and ensuring that money flows are for legitimate purposes. Banks in particular are required to report suspicious transactions to federal authorities.
Silvergate is under investigation by the Justice Department over dealings with the defunct Sam Bankman-Fried FTX exchange and Alameda Research, Bloomberg reported. Federal prosecutors and the US Securities and Exchange Commission are also examining the collapse of Silicon Valley Bank, even if the executives’ share sales violated trade rules.
Signature did not disclose the inquiries in its most recent regulatory filings.
After the FTX implosion in November, Signature executives said they intended to dump up to $10 billion in digital asset client deposits, which at the time accounted for more than a fifth of their deposit base. . But they still planned to keep some.