New York's Signature Bank Closes Two Days after Silicon Valley Bank

by M.C. Millman

Following fast on the heels of the closure of Silicon Valley Bank in Santa Clara, California, on Friday, as reported here, Signature Bank of New York announced the removal of its senior management and the closure of the bank earlier today.

The closure was made by Signature Bank's state chartering authority. 

Regarding Signature Bank's closure, the  Treasury, Federal Reserve, and FDIC announced in a joint statement that "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." 

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 also announced today that 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 U.S. banking system remains resilient and on a solid foundation," the press release by the  Treasury, Federal Reserve, and FDIC  declared at the same time, " 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."

"Throughout the weekend, DFS Superintendent Adrienne Harris and I have been working closely with Federal partners on ways to stabilize the banking sector and protect the hard-earned money of New Yorkers whose livelihoods depend on impacted companies, " Governor Kathy Hochul said in a statement."I'm grateful that the Federal regulators have taken steps to do just that, and I hope that these actions will provide increased confidence in the stability of our banking system. Many depositors at these banks are small businesses, including those driving the innovation economy, and their success is key to New York's robust economy."