Meet the 125-year-old bank that bought Silicon Valley Bank

The big picture: Founded in 1889 by Allen W. Smith (who remained president until 1906) as Bank of Smithfield, the business merged with Citizens National Bank in 1921, renaming itself First Citizens Bank and Trust Company eight years later.

Zoom in: A young Robert Powell Holding first joined as an assistant cashier in 1918 and worked his way up to the role of president in 1935. He led the bank through the Great Depression and World War II, growing it to become the second largest in North Carolina by the time he died in 1957.

• His three sons then took over the bank, maintaining control of it over the decades. It's now helmed by the third generation of the Holding family — whose influence in North Carolina has extended to the U.S. Congress and multiple corporate boardrooms.
• Frank B. Holding Jr. has served as CEO since 2008.

By the numbers: First Citizens was the 30th largest commercial bank in the U.S. at the end of 2022, according to Federal Reserve data. It had more than $109.3 billion in total assets and more than $89.4 billion in total deposits (68% of which are fully FDIC insured).

• It was already operating more than 500 branches across 22 states.
• Including SVB, it now controls $209 billion in assets.

Acquisitions are familiar territory

Since 2009, when Holding was elected chairman, First Citizens has acquired more than 20 banks — distressed banks, specifically.

• These include First CornerStone Bank, Harvest Community Bank and Guaranty Bank most recently. Last year, parent company First Citizens BancShares' merger with CIT (worth $2.2 billion) finally closed.
• “First Citizens has a history of [acquiring] troubled banks,” Herman Chan, an analyst with Bloomberg Intelligence, told Bloomberg News. “It’s a strategy to grow the bank when times are difficult — to conduct M&A at advantageous prices.”

State of play with SVB

So far, First Citizens’s plan seems to be to keep SVB operating as it was, at least as far as customers are concerned.

• It plans to "retain all employees in the acquired businesses," CFO Craig Nix told investors on a Monday call. (That's not to say First Citizens hasn't done post-acquisition layoffs in the past.)
• "For now, the business will continue as Silicon Valley Bank, a division of First Citizens Bank," a spokesperson tells Axios, adding that some of its senior execs have already visited SVB's Bay Area offices and expect to continue to do so.

First Citizens, meet Silicon Valley

While it has an established reputation in its corner of the country — and even within The Triangle's startup hub — First Citizens isn't a well-known brand among the Silicon Valley set.

• "[W]e have not been as active with tech start-ups and the venture capital community as Silicon Valley Bank has, which is one of the key reasons we were attracted to this transaction," the company tells Axios.
• So it'll need to lean on SVB's people to help clients grow their trust in its new parent.
• And while many customers have kept (or brought back) at least some of their cash at SVB, some that left entirely are not coming back.

The bottom line: Only time will tell if North Carolina's genteel banking culture can mesh successfully with Silicon Valley's rough-and-tumble ethos.