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FDIC Fiasco: Signature Bank Heist, New York, NY, 2023
Washington D.C. – In a brazen move, the FDIC has established Signature Bridge Bank, N.A. as the successor to Signature Bank, New York, NY, after the state’s Department of Financial Services shut down the institution on March 12, 2023.
The FDIC, acting as receiver, transferred all deposits and substantially all assets of Signature Bank to the new entity, which will be operated by the FDIC as it markets the institution to potential bidders. The move was made to protect depositors and preserve the value of the assets and operations of the failed bank.
Signature Bank had 40 branches across the country in New York, California, Connecticut, North Carolina, and Nevada. Banking activities will resume on Monday, March 13, 2023, including online banking. Depositors and borrowers will automatically become customers of Signature Bridge Bank, N.A. and will continue to have uninterrupted customer service and access to their funds by ATM, debit cards, and writing checks in the same manner as before.
The FDIC has also removed senior management and shareholders from the institution, with no losses borne by taxpayers. However, shareholders and certain unsecured debt holders will not be protected. Any losses to the Deposit Insurance Fund (DIF) to support uninsured depositors will be recovered by a special assessment on banks, as required by law.
The FDIC has named Greg D. Carmichael as CEO of Signature Bridge Bank, N.A. Mr. Carmichael recently served as president and CEO of Fifth Third Bancorp. The transfer of all deposits was completed under the systemic risk exception approved earlier today, ensuring that all depositors will be made whole.
The FDIC will operate Signature Bridge Bank, N.A. to maximize the value of the institution for a future sale and to maintain banking services in the communities formerly served by Signature Bank. The bridge bank structure is designed to “bridge” the gap between the failure of a bank and the time when the FDIC can stabilize the institution and implement an orderly resolution.
The FDIC has emphasized that the actions taken will protect depositors and preserve the value of the assets and operations of Signature Bank, which may improve recoveries for creditors and the DIF. Signature Bank had total assets of $110.4 billion and total deposits of $88.6 billion as of December 31, 2022.
Key Facts
- Agency: FDIC
- Category: Fraud & Financial Crimes
- Source: Official Source â†â€â€ÂÂÂ
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