NY.- New York Community Bank has agreed to buy a significant portion of the failed Signature Bank in a $2.7 billion deal, the US Federal Deposit Insurance Corporation (FDIC) said Sunday.
With this, the 40 branches of Signature Bank will become, starting this Monday, Flagstar Bank, one of the subsidiaries of New York Community Bank.
The deal will include the purchase of $38.4 billion in assets from Signature Bank, just over a third of the bank’s total bankruptcy a week ago.
The FDIC added that $60 billion in Signature Bank loans will remain in default and are expected to be sold on time.
After the Silicon Valley Bank bankruptcy, depositors became nervous about the health of Signature Bank due to its large number of uninsured deposits, as well as its exposure to crypto and other technology-focused lending. When shut down by regulators, Signature is the third largest bank failure in US history.
