More than six months after its March failure, the remaining
remnants of Signature Bank have been acquired by PNC Bank, one of the country’s
largest and most diversified financial institutions, from the Federal Deposit
Insurance Corp. (FDIC) in a deal valued at $16.6 billion in total commitments.
The FDIC took ownership of the defunct bank as receiver
shortly after it was shuttered by the New York State Department of Financial
Services. The FDIC then transferred the assets to Signature Bridge Bank, N.A.,
a full-service institution established and operated by the FDIC to provide
uninterrupted service to borrowers until a potential bidder could be
identified.
The bank’s portfolio includes $9 billion in funded loans,
and PNC said it plans to fund the purchase with available cash reserves,
according to a company press release. The acquisition is expected to
immediately boost PNC’s earnings, contributing approximately 10 cents per share
in the fourth quarter.
The transaction will not significantly impact PNC’s total
assets, capital ratios or tangible book value per share, the release states.
Notably, PNC acquired these commitments and loans without any funding,
guarantees, or loss-sharing agreements from the FDIC. Additional details about
the portfolio and the financial implications of this transaction will be
provided during PNC’s third-quarter earnings call scheduled for Oct. 13.
The capital commitments facilities involved in this
acquisition primarily consist of fund subscription lines designed to assist
private equity sponsors in managing liquidity and providing bridge financing
for their investments, the bank noted. PNC has a long history within the
capital commitments business, meaning this most recent acquisition aligns well
with the company’s existing activities.
The bank further noted the acquisition will strengthen its
suite of services tailored to the private equity industry, complementing their
offerings, which already include Harris Williams, Solebury, PNC Business Credit
and Midland Loan Services.