FDIC urges any buyer of Signature Bank to ditch crypto: Reuters

As the Federal Deposit Insurance Corporation prepares to auction Signature Bank, it has made it clear that the buyer should stop doing business with crypto, two unnamed sources said. Reuters.

If that’s true, it would seem confirm suspicions that regulators targeted Signature Bank because it did business with the crypto industry.

Earlier this week, Barney Frank, a former congressman who helped draft the Dodd-Frank Act, said CNBC that banking regulators shut down the bank to send “a very strong anti-crypto message.” Frank also served on the board of Signature Bank.

The New York Department of Financial Services was quick to deny its request, saying in a statement that the decision to place Signature in receivership “was based on the bank’s current status and ability to do business securely. and healthy”.

But now there are signs that the FDIC wants to make sure the bank doesn’t return to the private sector with its crypto business intact. In fact, only bidders with existing bank charters will be allowed to review the bank’s financial statements before submitting a bid, according to Reuters.

The FDIC said it would accept offers until tomorrow for Signature Bank, which it farm Sunday, and the Silicon Valley Bank, which it close March 10. For Silicon Valley Bank, or SVB, it will be the regulator’s second attempt to sell the institution after a failed auction on Sunday.

The FDIC tried to sell what’s left of SVB over the weekend, but couldn’t find a buyer willing to acquire the entire bank. The sources said Reuters that the FDIC would prefer to auction the two banks in their entirety, but will welcome bids for individual parts if it fails.

Signature Bank’s shares began trading on the Nasdaq under the symbol SBNY in 2004. In early 2022, its stock price reached an all-time high of $365.71 per share.

The bank also offered an instant settlement network for digital payments, Signet, which rivaled a similar service from Silvergate Bank.

By the time the Nasdaq ceased trading on SBNY on March 10, its shares were trading at $70.

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