2023-03-27 09:02:21 ET
- First Citizens BancShares ( NASDAQ: FCNCA ) shares rose 50% premarket on Monday after the Raleigh, North Carolina-based lender agreed to buy Silicon Valley Bank's ( NASDAQ: SIVB ) deposits and loans.
- The purchase of $72B in assets will come with a 23% discount of $16.5B, while approximately $90B in securities and other assets will remain in receivership for disposition by the FDIC.
- Analyst Brady Gailey from Keefe, Bruyette & Woods, which holds an "Outperform" rating on FCNCA, expects the deal's accretion to be significant to both earnings per share and tangible book value per share for FCNCA.
- Silicon Valley Bank, the California bank subsidiary of SVB Financial Group ( SIVB ), collapsed March 10 after depositors rushed to withdraw money amid fears about the bank’s health. The bank found itself in trouble when it "borrowed short and lent long" amid rising interest rate.
- As of Dec. 31, 2022, Silicon Valley bank had about $209.0B in total assets and about $175.4B in total deposits.
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First Citizens BancShares stock surges on Silicon Valley Bank deal