A First Citizens Bank sign is seen in Durham, North Carolina, on Monday March 27, 2023. North Carolina-based First Citizens will buy Silicon Valley Bank, the tech industry-focused financial institution that collapsed earlier this month. (AP Photo/Jonathan Drew)

NEW YORK (AP) — First Citizens will acquire much of Silicon Valley Bank, the tech-focused financial institution that collapsed this month, setting off a chain reaction that caused a second bank to fail and tested faith in the global banking sector.

The Federal Deposit Insurance Corp. and other regulators had already taken extraordinary steps to head off a wider banking crisis by guaranteeing that depositors in SVB and failed Signature Bank would be able to access all of their money.

While more than half of Silicon Valley’s assets will remain in U.S. receivership, the First Citizens deal announced late Sunday, at least initially, seemed to achieve what regulators have sought: a shoring up of trust in U.S. regional banks.

At the opening bell Monday, shares of midsized banks like Keycorp, Zions and First Horizon rose 8%. First Republic Bank, which received a $30 billion rescue package from 11 of the biggest banks in the country as it teetered in the wake of the Silicon Valley collapse, jumped 23%.

Customers of SVB will automatically become customers of First Citizens, which is headquartered in Raleigh, North Carolina. The 17 former branches of SVB will open as First Citizens branches Monday, the FDIC said.

European shares opened higher Monday, with German lender Commerzbank AG up 2.4% and BNP Paribas up 1.2%. Anxiety over contagion in the banking sector quickly spread to Europe this month and regulators there brokered a takeover by UBS of troubled Swiss bank Credit Suisse.

Shares of Deutsche Bank tumbled 8.5% Friday for similar reasons, rising interest rates, but stock in the German bank bounced back 3.6% Monday.

Silicon Valley, based in Santa Clara, California, collapsed March 10 in a bank run after customers rushed to withdraw money due to fears over the bank’s solvency. It was the second-largest bank collapse in U.S. history after the 2008 failure of Washington Mutual. Two days later, New York’s Signature Bank was seized by regulators in the third-largest bank failure in the U.S.

In both cases, the government agreed to cover deposits, even those that exceeded the federally insured limit of $250,000, so depositors were able to access their money.

New York Community Bank agreed to buy a significant chunk of Signature Bank in a $2.7 billion deal a week ago, but the search for a buyer for SVB took longer.

The sale of Silicon Valley Bank involves the sale of all deposits and loans of SVB to First-Citizens Bank and Trust Co., the FDIC said.

The acquisition gives the FDIC shares in First Citizens worth $500 million. Both the FDIC and First Citizens will share in losses and the potential recovery on loans included in a loss-share agreement, the FDIC said.

The FDIC will retain about $90 billion of Silicon Valley Bank’s $167 billion in total assets, as of March 10, while First Citizens will acquire $72 billion at a discount of $16.5 billion, the FDIC said. It said it estimates Silicon Valley Bank’s failure will cost its industry-funded Deposit Insurance Fund about $20 billion.

First Citizens Bank was founded in 1898 and says it has more than $100 billion in total assets, with more than 500 branches in 21 states as well as a nationwide bank. It reported net profit of $243 million in the last quarter. It is one of the top 20 U.S. banks and says it is the largest family-controlled bank in the country.