Signature Bank of New York Collapses; 2nd US Bank to Close Down in a Week

America’s state regulators on Sunday closed down the New York-based Signature Bank. It followed Silicon Valley Bank’s Friday shutdown, which was the second-largest banking failure in U.S. history after the collapse of Washington Mutual during the 2008 financial crisis. The closure of Signature Bank is said to be the third-largest failure in U.S. banking history.

The Federal Deposit Insurance Corporation (FDIC) took control of Signature Bank, which had $110.36 billion in assets and $88.59 in deposits at the end of 2022.

Signature was a commercial bank with private client offices in New York, Connecticut, California, Nevada, and North Carolina. It had nine national business lines including commercial real estate and digital asset banking.

All of the depositors of Signature Bank and Silicon Valley Bank will be made whole, and “no losses will be borne by the taxpayer,” the U.S. Treasury Department and other bank regulators said in a joint statement.

The Silicon Valley episode last week erased more than $100 billion in market value from U.S. banks. The FDIC established a “bridge” successor bank on Sunday which will enable customers to access their funds on Monday. Signature Bank’s depositors and borrowers will automatically become customers of the bridge bank, the FDIC said.