Silicon Valley Bank was bought by First-Citizens BancShares in March 2023

Silicon Valley Bank (SVB) failed on March 10, 2023, after a run on deposits triggered by rising interest rates and poor asset management. The Federal Deposit Insurance Corporation (FDIC) took control of the bank that same day. Two days later, on March 12, 2023, First-Citizens BancShares—a regional bank holding company based in North Carolina—purchased substantially all of SVB's assets and assumed its deposits through an FDIC-assisted transaction.

This was not a typical acquisition. First-Citizens did not pay cash for SVB. Instead, the FDIC arranged the deal to protect depositors and prevent broader financial instability. The FDIC covered the difference between what SVB's assets were worth and what First-Citizens paid, using its insurance fund. This structure meant that SVB's customers' accounts transferred to First-Citizens with their balances intact, even those above the $250,000 FDIC insurance limit.

First-Citizens is a publicly traded company with roughly $200 billion in assets at the time of the purchase. It operates primarily in the Southeast and Mid-Atlantic regions but had been expanding nationally. The acquisition of SVB's assets—roughly $91 billion—made First-Citizens significantly larger overnight.

Key Takeaways

  • First-Citizens BancShares bought SVB's assets and customer deposits through an FDIC-assisted transaction, not a traditional sale.
  • All SVB customer deposits transferred to First-Citizens, including balances above the $250,000 FDIC insurance limit, because the FDIC may provide the transaction.
  • The FDIC paid First-Citizens a loss-sharing agreement to cover the gap between SVB's asset value and its liabilities, protecting the insurance fund.
  • SVB customers kept their accounts, account numbers, and online access during the transition, though some services took time to fully integrate.
  • This purchase was a government-assisted resolution, not a competitive bid—the FDIC chose First-Citizens to stabilize the situation quickly.

What happened to SVB customer accounts after the purchase

If you had money in Silicon Valley Bank on March 10, 2023, your account moved to First-Citizens. The FDIC's action meant that all deposits—regardless of size—were protected. This was unusual. Normally, the FDIC insures only up to $250,000 per depositor per bank. But because the FDIC arranged the sale to prevent a wider banking crisis, it may provide all deposits, including those above the insurance limit.

Your account number changed. First-Citizens assigned new account numbers to all transferred accounts. You received new debit cards and had to update any automatic payments or transfers that relied on your old SVB routing number. Online banking access moved to First-Citizens' platform, though the transition took several days.

Most SVB customers experienced minimal disruption to accessing their money. Debit cards worked within hours. Wire transfers and ACH payments resumed within one to two business days. However, some customers reported delays in accessing online banking portals or confusion about their new account details during the first week.

Why the FDIC chose First-Citizens over other bidders

The FDIC did not run a public auction for SVB. Instead, it worked with a small group of large banks to find a buyer quickly. Speed was critical—a prolonged period without a buyer would have deepened panic in the banking system and potentially triggered failures at other institutions.

First-Citizens was chosen because it had the capital to absorb SVB's assets, the operational capacity to integrate a large bank quickly, and the willingness to move fast. The FDIC also structured the deal with a loss-sharing agreement, meaning the FDIC covered losses on certain assets if they performed worse than expected. This reduced First-Citizens' risk and made the deal attractive.

Other large banks, including JPMorgan Chase and Bank of America, were approached but declined to bid. They cited concerns about SVB's asset quality, the speed required, and the regulatory scrutiny that would follow. First-Citizens saw the opportunity differently and moved forward.

The FDIC's role in protecting your money

The FDIC is the federal agency that insures bank deposits. When a bank fails, the FDIC steps in, takes control of the bank, and arranges either a sale to another bank or a payout to depositors. In SVB's case, the FDIC chose the sale route because it was faster and more complete.

The FDIC's may provide of all SVB deposits—not just the insured $250,000—was a special decision made to prevent systemic risk. Large depositors, many of them venture capital firms and tech companies, held balances well above the insurance limit. If those deposits had been cut off or delayed, it could have triggered a cascade of business failures and further bank runs.

The cost of this protection came from the FDIC's insurance fund, which is funded by premiums that banks pay. The FDIC estimated the cost of the SVB resolution at roughly $20 billion, though the actual cost depends on how well First-Citizens' assets perform over time.

How First-Citizens integrated SVB into its operations

First-Citizens did not when ready merge SVB into its existing branches and systems. Instead, it kept SVB operating as a distinct subsidiary for several months while integrating the technology and operations. This approach reduced disruption for customers and gave First-Citizens time to assess SVB's loan portfolio and risk profile.

Over the following months, First-Citizens migrated SVB customers' accounts to its core banking platform. This process involved updating systems, training staff, and ensuring that all customer data transferred correctly. By mid-2023, most SVB customers were fully integrated into First-Citizens' systems.

First-Citizens also had to decide what to do with SVB's lending relationships and investment portfolio. SVB had significant exposure to the technology and venture capital sectors—the very sectors that had triggered the bank run. First-Citizens gradually wound down or restructured some of these relationships while keeping others that fit its risk profile.

What this means if you still bank with First-Citizens after the SVB acquisition

If your SVB account is now with First-Citizens, you have the same FDIC protection you would have at any other bank: up to $250,000 per account category. The special may provide that protected all SVB deposits above that limit expired once the transition was complete. Going forward, only the standard $250,000 limit applies.

Your account is insured separately from any other First-Citizens accounts you may have opened before or after the SVB acquisition. If you have a checking account and a savings account at First-Citizens, each is insured up to $250,000. If you have a joint account with a spouse, that is insured separately as well.

If you hold more than $250,000 at First-Citizens, you can protect the excess by opening accounts at other FDIC-insured banks or by using deposit insurance products like certificates of deposit at different institutions. The FDIC's website has tools to help you calculate your coverage.

Frequently Asked Questions

Did SVB customers lose any money when First-Citizens bought the bank?

No. The FDIC may provide all deposits, including those above the $250,000 insurance limit. Customers received their full balances when accounts transferred to First-Citizens. However, customers who had invested in SVB stock or held SVB bonds lost money, because those are not deposits and are not insured by the FDIC.

Can I move my account away from First-Citizens if I don't want to bank there?

Yes. You can transfer your account to another bank at any time. Contact First-Citizens to initiate a transfer, or open an account at another bank and have them pull your funds via ACH. There is no penalty for moving your account.

What if I had more than $250,000 at SVB and now have more than $250,000 at First-Citizens?

The special FDIC may provide that protected all SVB deposits ended once the transition was complete. Now only the standard $250,000 limit applies to each account category. If you want to protect balances above that, move the excess to another FDIC-insured bank or use other deposit insurance structures.

How long did it take for SVB customers to regain full access to their accounts?

Most customers regained access to their money within hours of the FDIC takeover. Debit cards worked when ready. Online banking access and wire transfer capability took one to two business days to restore. The full integration into First-Citizens' systems took several months, but customers could use their accounts normally during that time.

Is First-Citizens still operating SVB as a separate bank?

No. First-Citizens fully integrated SVB into its operations by mid-2023. SVB no longer operates as a distinct entity. Customers' accounts are now part of First-Citizens' standard banking platform, though some former SVB customers may still see SVB branding in their account history or statements.