Recent bank failures have created another problem for the housing market: lack of credit.
First American’s Potential Home Sales Model– a measure of what a healthy level of home sales should be based on market fundamentals– fell by 2.5% month-over-month in March. Year-over-year, it is down 10.7%, a loss of more than 640,000 sales.
The biggest contributor to the decline was tightening credit standards, First American says. At the beginning of the pandemic, lenders reduced credit due to the increased likelihood of forbearance and delinquency, but it slowly began to ease.
Now, credit is tightening again thanks to banking uncertainty.
“There are fears that the recent bank failures will prompt lenders to be much more conservative with their lending,” said…
By KIMBERLEY HAAS
Leaders at First Citizens Bank and Trust Company have entered into an agreement to acquire Silicon Valley Bridge Bank.
Silicon Valley Bridge Bank was created by officials at the Federal Deposit Insurance Corporation on March 13 after the collapse of Silicon Valley Bank. All deposits, insured and uninsured, substantially all assets, and all qualified financial contracts of Silicon Valley Bank were transferred to the bridge bank.
According to a press release, through an agreement with officials at the FDIC, First Citizens will assume Silicon Valley Bridge Bank’s assets of $110 billion, deposits of $56 billion, and loans of $72 billion.
“Today’s transaction included the purchase of about $72 billion of Silicon Valley Bridge Bank, National Association’s assets…
By KIMBERLEY HAAS
The administration worked to assure consumers that the banking system was safe on Monday following the sudden collapse of two financial institutions.
Officials at the Federal Deposit Insurance Corporation announced on Friday that Silicon Valley Bank was closed by the California Department of Financial Protection and Innovation. It was the biggest bank failure since Washington Mutual in 2008.
All insured deposits were transferred to the newly-created Deposit Insurance National Bank of Santa Clara.
Silicon Valley Bank had 17 branches in California and Massachusetts. As of December 31, 2022, it held approximately $209 billion in total assets and about $175.4 billion in total deposits, according to officials.
On Sunday, FDIC officials announced a similar fate for New York-based…
