First Citizens Bank acquire Silicon Valley Bank says FDIC

First Citizens, based in North Carolina, will acquire Silicon Valley Bank, a financial institution focused on the IT industry that failed earlier this month, rocking the banking industry and sending shockwaves around the world.

The FDIC said in a late Sunday statement that the sale includes the sale of all SVB deposits and loans to First-Citizens Bank and Trust Co. Customers of SVB will instantly become customers of First Citizens, based in Raleigh. The 17 former SVB locations will reopen as First Citizens locations on Monday.

The March 10 failure of Silicon Valley Bank spurred the FDIC and other regulators to take action to protect depositors and avert further financial instability.

The Santa Clara, California-based bank failed when depositors raced to withdraw funds due to concerns about the bank's health. After the fall of Washington Mutual in 2008, it was the second-largest bank failure in US history.

Regulators seized New York-based Signature Bank on March 12, making it the third-largest bank collapse in the United States.

In both situations, the government agreed to protect deposits up to the federally insured level of $250,000, allowing depositors at Silicon Valley Bank and Signature Bank to retrieve their funds.

Investors were concerned that the mid-sized San Francisco-based First Republic Bank, which serves a similar clientele as Silicon Valley Bank and appeared to be suffering a similar situation, would also fail. As a result, 11 of the country's largest banks launched a $30 billion rescue package.

First Citizens' acquisition of SVB provides the FDIC with $500 million in shares in the latter. According to the FDIC, both the FDIC and First Citizens will share losses and potential recoveries on loans included in a loss-sharing agreement.

First Citizens Bank was formed in 1898 and claims to have over $100 billion in total assets, as well as over 500 branches in 21 states and a nationwide bank. In the most recent quarter, it posted a net profit of $243 million.