Silicon Valley Bank Deposit Holders to Receive Full Payment
Silicon Valley Bank ranks 16th as one of the largest banks in the US, which the FDIC has takes over.
Last weekend, the Federal Reserve, Treasury Department, and Federal Deposit Insurance Corporation stated, “We will make additional funding available to ensure all Silicon Valley Bank deposits, insured and uninsured, will be fully paid.”
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The president approved the recommendation by the different boards, such as FDIC and the federal reserve.
In conjunction with consulting the president, secretary Janet Yallen approved and urged the FDIC to conclude its resolution with Silicon Valley Bank.
In a protective approach, Santa Clara from Califonia said, “Depositors will have access to all their money starting from Monday, March 13th. No losses associated with the resolution of Silicon Valley Bank will be borne by the taxpayer.”
Moreover, the effectiveness of the quotes and commendations will build reluctance in the minds of the depositors. They had in mind that they would always have access to money.
Silicon Salley Bank failed on Friday despite its fame in the country, which FDIC has now taken over.
Silicon Valley Bank's customer withdrawal made history.
$42 billion was withdrawn Thursday.
That's $4.2 billion an hour.
Previous largest bank run in modern U.S. history was Washington Mutual bank in 2008, and totalled $16.7 billion over 10 days.
History is being written.
— Genevieve Roch-Decter, CFA (@GRDecter) March 13, 2023
Customers withdrew over 42 billion dollars of deposits before Friday last week. With such a massive withdrawal, people who run businesses will have insecure thoughts about the money they deposit to the bank.
Federal regulators’ next move
The senior treasury official said, “The bank’s equity and bondholders are being wiped out. They took a risk as owners of the securities and will take the losses”.
Furthermore, regulators also took the unusual step of designating the bank and signature banks as a systematic risk to the economic system. The last time they used a designation was 15 years ago.
It is a grateful task that the regulators have undertaken. These actions will provide confidence to the banking system.
JUST IN: President Biden has just announced a PLAN to fix the Silicon Valley bank problem that DOESN’T bail out investors but allows victims to have access to their money.
That’s LEADERSHIP. pic.twitter.com/EKmVpAA2QJ
— CALL TO ACTIVISM (@CalltoActivism) March 13, 2023
The New York governor Kathy Hochul said, “many depositors at these banks are small businesses, including those driving the innovation economy, and their success is the key to New York’s economy.” Also added by Sen. Mark Warner, D-Va., tot
This week co-anchor Martha Raddatz earlier he said pumping the breaks on a potential SBV bailout.
“I know I have been in conversation with the regulators, the administration, the Fed; the best outcome will be can they find a buyer for this SBV bank today before the markets open in Asia later in the day.
That would be the best way to ensure the depositors. Remember that shareholders in the bank will lose their money. Let’s be clear about that. But the depositors will have security.
And the best outcome will be an acquisition of SBV.” He said, “Let me be clear that during the financial crises, there were investors and owners of systematic large banks bailed out, and we are certainly not looking.
He continued, “And the reforms in place mean we will not do that again.”
“But we are concerned about the depositors and are focused on trying to meet their needs.” The secretary, Janet Yellen, also said, “face the nation.”
The taking over of Silicon Valley Bank by the FDIC, paying the insured and the uninsured entirely, and depositors having access to their money at any time is a wise move.
This plan will secure and manage a percentage of the economic system and give confidence to the investors as well.
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