Citizens Financial (CFG) Plans to bid for SVB's Private Bank
Citizens Financial Group, Inc. CFG is planning to bid for the acquisition of Silicon Valley Bank’s or SVB’s private banking business, SVB Private, Reuters reported, citing two people familiar with the matter.
SVB Private offers banking, wealth management and trust services to high-net-worth individuals. A significant part of the business comprises Boston Private, a wealth manager acquired by Silicon Valley Bank in 2021.
Markedly, after the failure of Silicon Valley Bank, the FDIC, which now controls its assets, made failed attemptsto sell SVB's private banking business and Silicon Valley Bank together. Hence, the regulator is now seeking separate offers for SVB Private and Silicon Valley Bank. However, SVB Financial Group, the former parent of SVB, filed for bankruptcy protection last week and is not part of the sale process.
If a bid is made by CFG, the company will continue its acquisition spree. It announced a deal to acquire the online college planning platform College Raptor, Inc. in September 2022. In July 2022, it announced the acquisition of Paladin Advisors, an independent and registered investment advisor, to strengthen its private wealth management business.
In June 2022, in efforts to enhance its growing corporate advisory capabilities in the digital-infrastructure sector, Citizens Financial closed the buyout of DH Capital LLC. In April, the company completed the acquisition of Investors Bancorp for $3.39 billion, which strengthened its banking franchise and boosted the consumer customer base.
In February 2022, it closed the acquisition of 80 East Coast branches and the national online deposit business from HSBC. The acquisitions of Investors Bancorp and the HSBC branches create a strong franchise in the greater New York City and Philadelphia Metro areas, and New Jersey by adding 234 branches. Apart from this, the acquisitions have strengthened the company’s balance sheet, creating a strong foundation for revenue growth. Multi-year investments in buyouts enable the company to expand its product and fee-generation capabilities, as well as geographic reach.
Over the past six months, shares of CFG have plunged 11.2% compared with the industry’s 17.1% decline.
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Earlier this month, New York Community Bancorp, Inc. NYCB announced that its bank subsidiary, Flagstar Bank, acquired $38 billion in assets and assumed $36 billion of liabilities of Signature Bridge Bank, N.A., from the FDIC.
The deal comes after Signature Bank was closed by the regulators, following the collapse of Silicon Valley Bank. The FDIC took over the fallen bank and transferred all the deposits and substantially all the assets to Signature Bridge Bank, N.A.NYCB has received all the required regulatory approvals, including approval from the Office of the Comptroller of the Currency, and the deal has been closed.
Also,UBS Group AG UBS announced an all-share deal to acquire its troubled rival Credit Suisse Group CS in government-backed efforts to fend off further panic in the global banking system.
The failure of Silicon Valley Bank and Signature Bank spurred panic in the global banking system. Troubles ensued for Credit Suisse after the company’s managers identified “material weaknesses” in its internal controls on financial reporting as of the end of the prior year.
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