Just two days after the closure of Silicon Valley Bank, US state regulators on Sunday closed down New York-based Signature Bank, making it the third largest banking failure in the history of the United States, news agency Reuters reported.
The Federal Deposit Insurance Corporation (FDIC) took control of Signature Bank, which had over $110 billion in assets and almost $89 billion in deposits as of the end of last year. However, the U.S. Treasury Department and other bank regulators were quick to assure depositors that they would be fully reimbursed and that no losses would be borne by taxpayers.
On the day of the closure, employees of the bank gathered at its Manhattan headquarters for meetings, with catering provided by an Italian restaurant and Starbucks coffee. However, representatives for the lender did not immediately respond to a request for comment.
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Silicon Valley Bank's shutdown was also a cause of concern for investors, with the bank's collapse erasing over $100 billion in market value from U.S. banks. The bank had been the 16th largest lender in the country and had a focus on startups, but it was toppled by customer withdrawals.
The FDIC established a "bridge" successor bank on Sunday, which will allow customers to access their funds on Monday. The regulator also named former Fifth Third Bancorp Chief Executive Greg Carmichael as CEO of the bridge bank.
Customers of Silicon Valley Bank will also have access to their deposits from Monday, with the federal government announcing measures to shore up deposits and prevent broader fallout.
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Signature Bank had a long-standing relationship with former President Donald Trump and his family, having provided them with checking accounts and financed several of their ventures. However, following the January 6th riots on Capitol Hill, the bank cut ties with Trump and urged him to resign.