the 95 billion profit posted by first citizens bancshares inc from a onetime gain on its acquisition of silicon valley bank stands out as the secondlargest profit among all banks in the second quarter and is much higher than in any previous quarter for the company in an eventful period for the sector that saw the collapse of three banks first citizens bancshares fcnca posted the profit on may 10 it was the highest quarterly profit in the bank’s 125year history according to a source familiar with the company also read first citizens grows bigger with silicon valley bank deal but not big enough to move to next regulatory level the profit stemmed from accounting of the bank’s socalled takeunder deal for silicon valley bank with the federal insurance deposit corp as seller in traditional takeover acquisitions one bank buys another at a premium said tim coffey a regionalbank analyst at janney montgomery scott llc “basically a bank that buys another for less than fair market value books the difference as a gain to equity which flows through the income statement” coffey said in an email to marketwatch in a typical takeover deal a given bank with 100 million in net assets and 10 million in equity might be acquired by another bank for 15 million in a deal that would create 5 million of goodwill on the buyer’s balance sheet to account for the payment above the acquired bank’s value of equity in a takeunder deal in which a bank with 100 million of assets and 10 million in equity is seized by the fdic and sold for 5 million to a buyer bank that 5 million discount on the value of the acquired bank’s equity flows through the income statement of the acquiring bank as a onetime gain and boosts the equity on its balance sheet it’s possible for a takeunder deal to happen without the involvement of the fdic if a bank buys another bank for less than its book value one example was baycom corp’s bcml acquisition of pacific enterprise bancorp which closed in early 2022 and resulted in a bargain purchase gain of 16 million coffey said the collapse of silicon valley bank was the secondlargest bank failure of all time with assets of 209 billion when it was announced but it was surpassed by the collapse of first republic bank with 229 billion in assets on may 1 first republic was acquired by jpmorgan chase  co  jpm  which is booking a posttax gain of 26 billion not including 2 billion of posttax restructuring costs over the next 18 months as a result of the deal prior to this year no major takeunder deals had taken place since the global financial crisis of 2008 a spokesperson for first citizens declined to provide any additional commentary beyond the bank’s call with analysts on may 10 and its announcement of the silicon valley bank deal on march 26 on that day first citizens’ stock rocketed 52 to its largest oneday gain ever as investors calculated the boost to the bank’s total book value from the deal all told first citizens’ stock has risen 68 in 2023 compared with a loss of 287 by the spdr sp regional banking exchangetraded fund kre and a 139 rise by the sp 500 spx  octavio marenzi ceo of financialsector consulting firm opimas said he does not compile complete lists of regionalbank earnings but with the earnings figure from first citizens the quarter ranks as an unusually lucrative one for the sector “i would bet that 95 billion in profits must be the best regionalbank result ever” marenzi said “indeed that would be very respectable earnings for a moneycenter bank” for comparison the two largest us banks jpmorgan chase and bank of america corp bac  reported firstquarter profits of 126 billion and 82 billion respectively wells fargo  co wfc posted net income of 499 billion for the first quarter while morgan stanley ms earned 3 billion in the quarter and goldman sachs group inc gs earned 32 billion pnc financial services group inc pnc  one of the largest superregional banks booked firstquarter earnings of 169 billion first citizens acquired silicon valley bank at an asset discount of 1645 billion the company said on may 10 after breaking out about 483 million for adjustments and other items the bank reduced its asset discount to 136 billion from 1645 billion the bank booked a total gain of 98 billion on the deal after recognizing a 500 million payment to the fdic “reported net income for the quarter was obviously boosted by the gain on acquisition and we were pleased with adjusted net income as well” the bank said breaking out the gain and other items the bank’s adjusted firstquarter profit fell to 292 million or 2009 a share from 306 million or 2094 a share in the yearago quarter as part of the deal the fdic held about 90 billion in silicon valley bank securities and other assets in receivership for disposition with its massive onetime gain now counted first citizens’ profits are expected to return to less lofty levels for the second quarter analyst are projecting net income of 445 million and revenue of 238 billion as well as adjusted earnings of 4560 a share according to estimates compiled by factset the bank reports its secondquarter profit on aug 1 silicon valley bank signature bank and first republic bank all failed this year in the largest bank blowup since the global financial crisis the three banks were formerly components of the sp 500 also read fdic set to levy big banks to pay for 158 billion bailout of silicon valley signature banks