New York-based Flagstar Bank acquires partial assets of Signature Bridge Bank

People walk past a Signature Bank branch in New York, the United States, on March 13, 2023. (Photo by Michael Nagle/Xinhua)

Flagstar Bank takes over all branches of Signature Bridge Bank and operates them under the Flagstar Bank brand, according to a press release by Flagstar Bank.

NEW YORK, March 20 (Xinhua) -- New York Community Bancorp, Inc. announced on Monday that its wholly-owned subsidiary Flagstar Bank, N.A. has acquired partial assets of Signature Bridge Bank N.A. from the Federal Deposit Insurance Corporation (FDIC).

The transaction marks significant progress in the FDIC's receivership of Signature Bank, which was closed by the New York State Department of Financial Services on March 12. The FDIC created Signature Bridge Bank on the same day to take over the operations of Signature Bank.

In particular, Flagstar Bank bought about 38 billion U.S. dollars of assets from Signature Bridge Bank including around 25 billion dollars in cash and about 13 billion dollars in loans.

Meanwhile, Flagstar Bank assumed about 36 billion dollars of liabilities in the deal, including around 34 billion dollars of deposits and around 2 billion dollars of other liabilities.

Flagstar Bank also takes over all branches of Signature Bridge Bank and operates them under the Flagstar Bank brand, according to a press release by Flagstar Bank.

Flagstar Bank purchased commercial and industrial loans from Signature Bridge Bank, excluding any digital asset banking, crypto-related assets or deposits as well as loans and deposits related to the fund banking business.

Flagstar Bank did not buy approximately 4 billion dollars of deposits related to the former Signature Bank's digital banking business and the FDIC will provide these deposits directly to customers whose accounts are associated with the digital banking business, said an FDIC press release on Sunday.

Following the deal, approximately 60 billion dollars worth of loans will remain in the receivership for later disposition by the FDIC.

By the end of 2022, the former Signature Bank had total deposits of 88.6 billion dollars and total assets of 110.4 billion dollars.

With nearly 400 branches across nine states in the United States, Flagstar Bank is one of the largest regional banks in the country. New York Community Bancorp reported 90.1 billion dollars of assets and 58.7 billion of deposits by the end of 2022.

Fueled by concerns over safety of deposits, recent bank runs have caused the collapse of Silicon Valley Bank and Signature Bank, which rank as the second and the third largest bank failures in U.S. history.