SVB Collapse: Federal Regulators Shut Down Signature Bank in New York

Another bank, Signature Bank in New York, was closed by federal regulators on Sunday, the second bank closure in three days.

Signature Bank New York was closed by the state chartering authority, New York Department of Financial Services (DFS), U.S. regulators announced on Sunday March 12.

All depositors will be able to receive 100% of their money, federal regulators said.

"All depositors of this institution will be made whole. As with the resolution of Silicon Valley Bank, no losses will be borne by the taxpayer," according to a joint statement from Secretary of the Treasury Janet Yellen, Federal Reserve Board Chair Jerome Powell, and the Federal Deposit Insurance Corporation (FDIC) Chairman Martin Gruenberg.

"Shareholders and certain unsecured debt holders will not be protected," the agencies said. "Senior management has also been removed. Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law."

The Federal Reserve Board on Sunday also said it would make "available additional funding to eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors."

The agencies said the "U.S. banking system remains resilient and on a solid foundation, in large part due to reforms that were made after the financial crisis that ensured better safeguards for the banking industry. Those reforms combined with today’s actions demonstrate our commitment to take the necessary steps to ensure that depositors’ savings remain safe."

Signature Bank New York's headquarters is located at 565 5th Ave. The firm was established in 2001 and has 40 domestic locations in five states, according to the FDIC.

This is the second bank closure in three days. 

The bank specializes in working with the cryptocurrency industry. As of Dec. 31, 2022, the bank had $110.4 billion in total assets and $88.6 billion in total deposits, according to a securities filing.