Second US bank closes in attempt to prevent instability

Another US bank has been closed due to what regulators called a “systemic risk”.

Over the weekend, Silicon Valley Bank was forced to close after depositors at a bank run rushed to withdraw their funds all at once.

Today it was announced that New York-based Signature Bank has also been forced to close its doors.

“We are also announcing a similar systemic risk exemption for Signature Bank, New York, New York, which was closed today by its state charter authority,” the Treasury Department, the Federal Reserve and the FDIC said in a joint statement.

Signature Bank’s most recent filings show it had $110.4 billion in total assets and $88.6 billion in total deposits.

According to the CNBC news outlet, the bank was a favorite among the cryptocurrency industry.

The US Fed and Treasury today announced a massive program to secure investors’ money at the two banks, which will be paid out in full.

“This step will ensure that the U.S. banking system continues to perform its vital roles of protecting deposits and providing access to credit to households and businesses in a way that promotes strong and sustainable economic growth,” the agencies said in a joint statement.

However, shareholders in the banks will be left empty-handed without any government rescue package.

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