The bank that bought the pieces of Silicon Valley Bank after its March collapse will no longer draft general office loans moving forward as it braces for an uptick of possible defaults.

First Citizens BancShares Chief Financial Officer Craig Nix said during a Wednesday earnings call that the Raleigh-based bank would no longer originate new office loans as it sets aside more allowance for credit losses on the $1.3B in loans it holds for Class-B office repositions and bridge financing.

The allowance, known as an ACL, on those loans was 5.24%, while ACLs on the overall general office portfolio were 2.67%, Nix said.

“We are not originating new loans in this space and are diversifying to other performing property types,” Nix said. “As these loans approach maturity, we are working with our clients on an individual basis to assess potential concerns and ensure we are addressing them quickly. So while we expect some additional downward migration in this portfolio, we do believe the issues are manageable.”

First Citizens reached a deal with the Federal Deposit Insurance Corp. to buy all the assets and liabilities of SVB on March 27, 17 days after SVB collapsed following a bank run. At the time, SVB had approximately $2.6B of CRE loans on its books.

First Citizens' commercial real estate loan exposure was 12% of its $138B in total loans, with 2.1% — or $2.8B — backing general office loans, Bloomberg reported. Of that, the average general office loan totaled $2M with a delinquency rate of 6.7%, according to Bloomberg.