Silicon Valley Bank (SIVB) closed by regulators, insured deposits to be protected by FDIC
As SVB has been closed and its deposits have been taken over, the Federal Deposit Insurance Corp. has announced that insured depositors will have access by Monday.
SVB Financial’s situation seems to get worse by the second today, with the latest update being that Silicon Valley Bank has been closed by regulators. The Federal Deposit Insurance Corp. (FDIC) has taken the reins on deposits at the bank and promised insured depositors that they will have access to their deposits restored by Monday. This spells more bad news for SVB Financial, which had already had its stock plummet and was supposedly in talks to sell itself off entirely.
The FDIC released an announcement on the situation with SVB Financial on March 10, 2023, following word of the bank talking about selling itself off completely. As of today, Silicon Valley Bank has been closed by the California Department of Financial Protection and Innovation, with the FDIC appointed as receiver and overseer of deposits.
“All insured depositors will have full access to their insured deposits no later than Monday morning, March 13, 2023,” the FDIC wrote. “The FDIC will pay uninsured depositors an advance dividend within the next week. Uninsured depositors will receive a receivership certificate for the remaining amount of their uninsured funds. As the FDIC sells the assets of Silicon Valley Bank, future dividend payments may be made to uninsured depositors.”
Source: FDIC
This follows on top of a whirlwind of bad news for SVB Financial this week. What began with the SIVB stock plummeting this week as CEO Greg Baker wrote that the company was looking to raise over $2 billion in cash to cover its losses turned into a deeper plummet when the group failed to secured that funding and spoke of selling off completely. It’s also worth noting that insured deposits will only cover up to $250,000, which spells bad news for companies that deposited in Silicon Valley Bank beyond that amount.
SVB Financial was a major backer and bank institution for a number of tech startups, but its future remains in serious doubt following today’s announcements. With regulators planning to reopen bank branches under strict regulatory supervision on Monday, stay tuned for further updates as we continue to follow this story.
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replyTJ Denzer posted a new article, Silicon Valley Bank (SIVB) closed by regulators, insured deposits to be protected by FDIC
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hahahahahahah morons
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If you wanted access to their premium services you needed a higher deposit like $1M. Sure you expose yourself to events like this but generally it's really low risk.
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They all have one foot on a private plane just chilling.
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Obviously no one has sympathy for the banks but isn’t this kind of the nature of the game? If you admit there’s a liquidity risk then you actually massively increase the risk by driving people to liquidate? Like the most likely way to avoid a bad outcome for the most people is say everything is fine while you attempt to find more funding? Of course the banks shouldn’t allow themselves to get into this situation but once you’re in it for whatever reason your options are pretty limited and being honest isn’t really rewarded (for the bank or the majority of customers).
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https://nitter.nl/CoinDesk/status/1634277243487768579
Circle’s USDC, the second largest stablecoin with $43 billion market capitalization, held an undisclosed part of its $9.8 billion cash reserves at failed Silicon Valley Bank.
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