After Silicon Valley Bank (SVB) ran into financial difficulties, the Federal Deposit Insurance Corporation (FDIC) and the California Department of Financial Protection and Innovation closed the institution The FDIC took over the failed bank Insured depositors will be able to withdraw their funds on Monday after.
Fed-insured depositors will withdraw funds Monday, uncertainty looms for depositors with accounts over $250,000
On Friday, U.S. regulatorsclosedSilicon Valley Bank’s (SVB) stock price fell sharply, following reports of the bank’s deposit outflows, SVB’s stock was halted on the NASDAQ market, and rumors spread that the bank was looking for a buyer. Rumors spread that the bank was looking for a buyer. Shortly thereafter, the California Department of Financial Protection and Innovation and the FDIC closed SVB.
The FDIC announced that depositors with federally guaranteed deposits up to $250,000 could withdraw their funds on Monday. It is unclear how the bank will handle deposits of larger amounts.” At the time of closing, the FDIC in receivership “immediately transferred all insured deposits at Silicon Valley Bank to DINB,” the agency explained Friday, and depositors with accounts over $250,000 may contact the FDIC for a resolution.
Regulators noted that SVB had $209 billion in assets and $175.4 billion in deposits at the end of 2022.” The FDIC statement notes that “at the time of closing, the amount of deposits in excess of the insured limit is undefined.” The amount of uninsured deposits will be determined after the FDIC obtains additional information from the bank and its customers.”
The Silicon Valley Bank failure is one of the largest bank failures in the U.S. since thebankruptcyof Washington Mutual (Wamu); SVB’s failure comes shortly after a liquidation announcement by crypto-friendly lender Silvergate Bank, which announced it would scale back operations Silvergate Bank, a crypto-friendly lender, announced it was scaling back operations.
What do you think the closure of Silicon Valley Bank and the recent liquidation announcement by Silvergate Bank say about the state of the banking industry? Share your thoughts on this subject in the comments section below.
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