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New York Community Bank to buy failed Signature Bank for $2.7 billion

Signature Bank was the second bank to fail in this banking crisis, roughly 48 hours after the collapse of Silicon Valley Bank.

Hritika Mitra Edited By: Hritika Mitra @MitraHritika New York Published on: March 20, 2023 8:02 IST
The FDIC said $60 billion in Signature Bank's loans will
Image Source : AP/FILE The FDIC said $60 billion in Signature Bank's loans will remain in receivership and are expected to be sold off in time.

The New York Community Bank has agreed to buy a significant part of the failed Signature Bank for $2.7 billion, according to the Federal Deposit Insurance Corp. 

The 40 branches of Signature Bank will become Flagstar Bank, starting Monday. Flagstar is one of New York Community Bank's subsidiaries. The deal will include the purchase of $38.4 billion in Signature Bank's assets, a little more than a third of Signature's total when the bank failed a week ago.  The FDIC said $60 billion in Signature Bank's loans will remain in receivership and are expected to be sold off in time.

Signature Bank was the second bank to fail in this banking crisis, roughly 48 hours after the collapse of Silicon Valley Bank. Signature, based in New York, was a large commercial lender in the tristate area, but had in recent years gotten into cryptocurrencies as a potential growth business.

UBS to buy Credit Suizze 

Banking giant Union Bank of Switzerland (UBS ) is all set to buy its smaller rival Credit Suisse in an effort to avoid further market-shaking turmoil in global banking, Swiss President Alain Berset announced on Sunday.

UBS to buy Credit Suizze for $3.2 million. The deal was 'one of great breadth for the stability of international finance,' UBS president said said. "An uncontrolled collapse of Credit Suisse would lead to incalculable consequences for the country and the international financial system.”

The Swiss Federal Council, a seven-member governing body that includes Berset, passed an emergency ordinance allowing the merger to go through without the approval of shareholders. Credit Suisse Chairman Axel Lehmann called the deal “a clear turning point.”

“It is a historic, sad and very challenging day for Credit Suisse, for Switzerland and for the global financial markets,” Lehmann said, adding that the focus is now on the future and in particular on the 50,000 Credit Suisse employees, 17,000 of whom are in Switzerland.

ALSO READ | After Silicon Valley Bank, Signature Bank shuts down amid banking turmoil in US

ALSO READ | Credit Suisse crisis: Switzerland's biggest bank UBS offers $1 Billion to acquire rival: Report

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