What is a bridge bank?

The bridge bank is established to assume the assets, debts, and contracts of the failed bank so that customers of the failed bank remain unaffected by the failure. The failed bank no longer operates. The bridge bank essentially takes over for it while a buyer is sought or the decision is made to wind down and liquidate the failed bank.

Does bridge bank offer escrow services?

Bridge Bank also serves the private equity and venture capital communities and provides business escrow services. Bridge Bank is part of Western Alliance Bancorporation, which has more than $65 billion in assets and ranked #1 among top-performing large banks with assets greater than $50 billion in 2021 by both American Banker and Bank Director.

Who appoints the CEO of a bridge bank?

The bridge bank operates under a board appointed by the FDIC. The FDIC also may appoint the CEO. A bridge bank is formed by a financial regulator, central bank, or, in the U.S., a federal financial insurance corporation such as the FDIC.

What happens if a bridge bank cannot be sold?

If the bank cannot be sold as a going concern, its portfolio of assets are liquidated in an orderly fashion. Should the bridge bank fail to wind down its operations within the allotted time, the national deposit insurance corporation is appointed as the receiver of the bridge bank's assets.