Signature Bank's Move Into Higher-Risk Businesses, Such As Crypto Major Reason For Failure: WSJ

The Signature Bank SBNY had been reportedly retreating from real-estate lending as a share of its total business after Signature’s exposure exceeded what U.S. bank regulators recommended for managing risk.
It also reduced real-estate lending after changes to New York tenant laws that made it difficult harder for landlords to profit from deregulation.
“We don’t want the [commercial real estate] concentration that we currently have,” Signature’s vice chairman, John Tamberlane, said at a finance-industry conference in 2018.
Signature branched out into heavy-equipment lending and loans to cab drivers. It later provided short-term loans for private-equity investors and launched a transaction platform targeting crypto businesses, Wall Street Journal reported.
Signature further slowed the growth of its multifamily lending after New York state laws passed in 2019 closed several loopholes that had enabled landlords to deregulate rent-controlled apartments.
Signature faced a crisis of confidence after regulators took over Silicon Valley Bank SIVB. The New York bank was also reeling from a bet on crypto banking that collapsed after the sector imploded and banking regulators cracked down on lenders’ exposure to digital assets, the report added.