The U.S. Federal Deposit Insurance Corporation (FDIC) has found a buyer for the failed, crypto-friendly financial institution Signature Bank.
According to a new press release from the regulator, the FDIC has entered into a “purchase and assumption agreement” with Flagstar Bank, a subsidiary of New York Community Bancorp.
The document states that the deal is worth $38.4 billion, which includes “substantially all deposits and certain loan portfolios” of the failed bank.
The terms, however, do not include Signature’s approximately $4 billion of deposits related to its digital-assets banking business. The FDIC says it will provide the deposits directly to those customers.
Reuters reported last week that the FDIC required any banks interested in acquiring Signature to agree to give up all of the company’s businesses that were related to crypto.
Included in the $38.4 billion deal is $12.9 billion of Signature’s loans, which Flagstar bought at a discount of $2.7 billion. The FDIC’s receivership will hold onto $60 billion of Signature’s loans, and the regulator also received stock in New York Community Bancorp worth up to $300 million.
The New York State Department of Financial Services shuttered the crypto-friendly bank earlier this month after customers withdrew $10 billion worth of deposits in a single day. The state regulator appointed the FDIC to run a “bridge bank” holding all of Signature’s assets until the financial institution could be sold off.
Signature Bank board member Barney Frank, a former Democratic congressman from Massachusetts, told CNBC last week that he thought the bank’s closure was part of a regulatory crackdown on crypto.
“I think part of what happened was that regulators wanted to send a very strong anti-crypto message. We became the poster boy because there was no insolvency based on the fundamentals.”
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