Silicon Valley Bank Collapse 
A buyer has been found for the collapsed tech sector lender Silicon Valley Bank, the banking failure which signalled the financial unrest still affecting financial markets. As the second largest bank failure in US history, it set off the worst banking crisis since the 2008 financial crash.
First Citizen Bank has bought SVB from the US regulator Federal Deposit Insurance Corporation, after it took over the bank earlier this month as investors raced to withdraw money. According to the FDIC, the failure of the lender will cost around $20bn; the costs of which will be borne by the deposit insurance fund, paid for by banks whose deposits are insured.
All of SVB’s deposits and loans (estimated $119bn) will be taken over by First Citizen Bank which will open 17 former SVB branches as ‘First Citizen Banks’ and consequentially, all SVB customers will automatically become First Citizen Bank customers. First Citizens, founded in 1898 to serve North Carolina’s farmers, survived the financial crisis of 2008 and has seen continuous growth through acquisitions.
The growth of SVB as a major lender can be attributed to its targeting start-ups and fast growing companies in the Silicon Valley tech sector, with ventures in other countries including the UK. However, its customers began withdrawing their deposits following news that the value of SVB’s bonds had fallen due to rising interest rates. Fearing the spread of that contagion, the Biden administration agreed to cover all deposits at the bank, including those not federally insured.
The UK arm of SVB was bought by HSBC shortly after its collapse, following a rescue deal by the UK government.
Following the turmoil, Switzerland’s second largest lender Credit Suisse, was forcibly purchased by longstanding rival UBS and last week, Germany’s largest bank, Deutsche Bank, became the focus in a new wave of selling across banking and financial stocks.
