On the heels of the Silicon Valley Bank collapse comes the second one. New York’s Signature Bank also collapsed on Sunday, becoming the third largest bank failure in U.S. history.
Details:
Here is the full press release:
Press Release
March 12, 2023
Superintendent Adrienne A. Harris Announces New York Department of Financial Services Takes Possession of Signature Bank
Superintendent Adrienne A. Harris announced today that the New York Department of Financial Services (DFS) has taken possession of Signature Bank, pursuant to Section 606 of New York Banking Law, in order to protect depositors. DFS appointed the Federal Deposit Insurance Corporation (FDIC) as receiver of the bank.Signature Bank is a New York state-chartered commercial bank and is FDIC-insured, with total assets of approximately $110.36 billion and total deposits of approximately $88.59 billion as of December 31, 2022.
DFS is in close contact with all regulated entities in light of market events, monitoring market trends, and collaborating closely with other state and federal regulators to protect consumers, ensure the health of the entities we regulate, and preserve the stability of the global financial system.
For information about FDIC coverage limits and requirements, visit www.fdic.gov or call toll-free 1-877-ASK-FDIC.
Joint statement by the Treasury, Federal Reserve, and FDIC:
Washington, DC — The following statement was released by Secretary of the Treasury Janet L. Yellen, Federal Reserve Board Chair Jerome H. Powell, and FDIC Chairman Martin J. Gruenberg:
Today we are taking decisive actions to protect the U.S. economy by strengthening public confidence in our banking system. This step will ensure that the U.S. banking system continues to perform its vital roles of protecting deposits and providing access to credit to households and businesses in a manner that promotes strong and sustainable economic growth.
After receiving a recommendation from the boards of the FDIC and the Federal Reserve, and consulting with the President, Secretary Yellen approved actions enabling the FDIC to complete its resolution of Silicon Valley Bank, Santa Clara, California, in a manner that fully protects all depositors. Depositors will have access to all of their money starting Monday, March 13. No losses associated with the resolution of Silicon Valley Bank will be borne by the taxpayer.
We are also announcing a similar systemic risk exception for Signature Bank, New York, New York, which was closed today by its state chartering authority. All depositors of this institution will be made whole. As with the resolution of Silicon Valley Bank, no losses will be borne by the taxpayer.
Shareholders and certain unsecured debtholders will not be protected. Senior management has also been removed. Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.
Finally, the Federal Reserve Board on Sunday announced it will make available additional funding to eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors.
The U.S. banking system remains resilient and on a solid foundation, in large part due to reforms that were made after the financial crisis that ensured better safeguards for the banking industry. Those reforms combined with today’s actions demonstrate our commitment to take the necessary steps to ensure that depositors’ savings remain safe.
CBS News reported:
The New York Department of Financial Services announced Sunday that it has taken possession of Signature Bank and appointed the Federal Deposit Insurance Corporation (FDIC) as the bank’s receiver. The move comes two days after Silicon Valley Bank collapsed as depositors rushed to withdraw funds.
At more than $110 billion in assets, Signature Bank is the third-largest bank failure in U.S. history, the Associated Press reported.
The bank is FDIC-insured and had assets of around $110.36 billion, with total deposits of about $88.59 billion as of Dec. 31, 2022, DFS said in a statement. Both figures were roughly half of what SVB had at the end of 2022, according to the FDIC.
All depositors will be made whole, the Federal Reserve, Treasury Department and FDIC said Sunday in a joint statement.
“Shareholders and certain unsecured debtholders will not be protected,” the agencies said. “Senior management has also been removed. Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.”
The joint statement also said that Silicon Valley Bank depositors would have access to “all of their money” beginning Monday. For both SVB and Signature Bank, “no losses associated by the resolution” of the banks would be borne by the taxpayer, the statement added.
Earlier Sunday, Treasury Secretary Janet Yellen told “Face the Nation” that the federal government will not provide a bailout for SVB’s investors.
“We’re not going to do that again,” she said. “But we are concerned about depositors, and we’re focused on trying to meet their needs.”
FOX News’ Eleanor Terrett reports the bank was known for being “crypto-friendly”:
