Buyers sought for Signature Bank's $33 bln CRE portfolio (updated)

Signature Bank

05/09/2023 19:54

(Adds detail and context)
    By Pete Schroeder
       WASHINGTON, Sept 5 (Reuters) - The U.S. Federal Deposit
Insurance Corporation (FDIC) is seeking buyers for the $33
billion commercial real estate (CRE) loan portfolio of failed
New York lender Signature Bank, it said on Tuesday.
    The majority of the portfolio comprises multi-family
properties primarily located in New York City, the regulator
said, adding that it would be marketing the asset over the next
three months. 
    The FDIC has been seeking to sell off portions of Signature,
one of three larger banks that failed in the spring, since the
bank was closed in March after an exodus of depositors seeking
higher returns and safer institutions.
    Later that month New York Community Bancorp  NYCB.N  agreed
to a deal with the FDIC to buy most deposits and certain loan
portfolios along with all 40 of Signature's former branches.
    Within the CRE portfolio is about $15 billion of loans
secured by residences that are rent stabilized or controlled.
    Since the FDIC has a legal obligation to preserve existing
affordable housing for lower-income people, the agency said it
planned to place all those loans within joint ventures in which
FDIC would retain a majority equity interest. 
    Any winning bidders for those ventures would be responsible
for managing and servicing the loans but would have to meet
certain requirements to preserve the loans and underlying
collaterial, the FDIC said.
    New York City and State housing authorities, as well as
community groups, are providing input to the FDIC as it begins
marketing. The FDIC said it expects to complete any portfolio
sales by the end of 2023.

 (Reporting by Michelle Price and Pete Schroeder
Editing by David Goodman)
 ((michelle.price@thomsonreuters.com; +12026041711; Twitter:
@michelleprice36;))