On Monday, about a week after the collapse of Signature Bank, the Federal Deposit Insurance Corporation (FDIC) announced that Flagstar Bank, a wholly owned subsidiary of New York Community Bancorp, acquired 40 former branches of Signature and its assets. Flagstar assumed nearly all of Signature’s deposits, except for $4 billion of deposits related to the bank’s crypto banking business.
FDIC Expects $2.5 Billion Loss from Signature Bank Failure, Extends Bid Window for Silicon Valley Bank
The FDIC has announced that Flagstar Bank, a subsidiary of New York Community Bancorp, has acquired the assets and bank branches of Signature Bank as of March 20, 2023. The branches will continue to operate during regular business hours. With the exception of depositors related to the digital banking business, depositors of Signature Bank will automatically become depositors of Flagstar Bank.
I really hope we will understand how Signature Bank was selectively stripped of its digital assets business before being acquired.
— David Marcus (@davidmarcus) March 20, 2023
Despite statements from the FDIC to the contrary, Flagstar purchased Signature Bank without acquiring its cryptocurrency operations. Sources familiar with the sale had suggested that divestment of crypto activities was required, but the FDIC insisted last week that it would not be necessary. The New York State Department of Financial Services also stated publicly that Signature’s shutdown was unrelated to cryptocurrency, prior to the FDIC’s announcement. Former politician Barney Frank speculated that the closure
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Author: Jamie Redman
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