Bank of America has Signature Bank in its sights and plans to acquire the failed institution on Monday, according to billionaire investor and hedge fund manager Bill Ackman.
Ackman relayed the assertion in a tweet Friday afternoon, albeit without naming a source.
I am hearing that @BankofAmerica is going to buy Signature Bank on Monday. Unless and until we can protect uninsured deposits, the cost of capital is going to rise for smaller banks pushing them to merge or be acquired by the SIBs. I don’t think this is good for America.
— Bill Ackman (@BillAckman) March 17, 2023
Signature Bank was taken over by regulators on March 12, two days after the collapse of Silicon Valley Bank. It had $110.36 billion in assets and $88.59 billion in deposits at the end of last year, according to New York state's Department of Financial Services.
Ackman, the CEO of Pershing Square Capital Management, previously voiced opposition to the $30 billion rescue of First Republic Bank by a group of tier-1 banks, also including BofA.
In his eyes, the move causes has done more harm than good in terms of potential bank contagion.
“FRB is no SVB. It is a well-managed, well-capitalized, high-service bank with good assets that is beloved by its clients,” Ackman wrote. “It is caught up in a bank run due to no fault of its own. It does not deserve to fail.”
Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com
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