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U.S. FDIC weighs holding Signature Bank, SVB“s underwater assets -Bloomberg News

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People gather outside of the Silicon Valley Bank (SVB) headquarters in Santa Clara, California, U.S. March 10, 2023. REUTERS/Nathan Frandino/File Photo

U.S. regulators are considering retaining securities owned by Signature Bank (SBNY.O) and Silicon Valley Bank (SIVB.O) which sank in value due to rising interest rates, Bloomberg News reported on Friday.

The move could facilitate the process of takeovers which became more challenging due to declining value of the assets, the report said, citing people familiar with the matter.

The amount covered at Signature could range from $20 billion to $50 billion, while for Silicon Valley Bank it could be between $60 billion and $120 billion, the report added.

FDIC, Signature Bank, Silicon Valley Bank did not immediately respond to Reuters requests for comment.

SVB Financial Group, the former parent company of Silicon Valley Bank, filed for a court-supervised reorganization under Chapter 11 bankruptcy protection to seek buyers for its assets.

Financial stocks have lost billions of dollars in value since the collapse of Silicon Valley Bank and Signature Bank last week, while credit stress has worsened for Wall Street’s biggest banks.

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