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FDIC Takes over Silicon Valley Bank
21–30 of 1001 posts
Re: FDIC Takes over Silicon Valley Bank
#22Yesterday I read on here that "xyz doesn't mean SVB is going under like FTX did five minutes after doing that".
The difference is that SVB's depositors will see most of their money back, which is the point of the FDIC taking over.
When, though?
If your company can't access your money to access payroll for X months, you might as well as be dead.
Re: FDIC Takes over Silicon Valley Bank
#23Oldie but goodie on what actually happens when a bank is taken over. https://www.npr.org/2009/03/26/102384657/anatomy-of-a-bank-t...
That's fascinating. I'd love to watch a documentary about that.
60 Minutes followed an FDIC takeover in 2009, including when the agents actually walked into the bank’s headquarters: https://youtu.be/TAE8i40A5uI
Re: FDIC Takes over Silicon Valley Bank
#24Yikes. Does anyone have an idea of which orgs have significant exposure (like Molly White's FTX contagion graph[0])?
Re: FDIC Takes over Silicon Valley Bank
#25Oh dear. It guess this is how the VC pyramid scheme collapses. $151BN uninsured deposits in the bank. [0] Now all those unprofitable startups will be falling like dominoes as now the money is tied up in the bank with withdrawals disabled. [0] https://twitter.com/FedGuy12/status/1634038788468113408
Does this mean that SVB customers are going to lose deposits over the FDIC limit (250k?)
For now yes, you get a note on what’s owed that remains and in time you get some of your money back post bankruptcy.
Keep your accounts lower than 250k
Re: FDIC Takes over Silicon Valley Bank
#26Oldie but goodie on what actually happens when a bank is taken over. https://www.npr.org/2009/03/26/102384657/anatomy-of-a-bank-t...
I know a couple bank VPs who have been the representative of the take-over bank in absorbing failed banks. They describe it in terms that most of us would recognize as taking over a failed project and re-architecting/refractoring it so that it can succeed (or making the call to discard all work to date and start over with a workable solution).
Re: FDIC Takes over Silicon Valley Bank
#27Only 3% of deposits in the bank are FDIC insured; other depositors will need to wait for the receivership process to run to get access to (what remains) of their deposits. edit: replace "bankruptcy" with "receivership" as the latter is usually a faster process than the former.
Where'd you get the 3% figure? The only thing I saw in the article was that it was not determined. > At the time of closing, the amount of deposits in excess of the insurance limits was undetermined. The amount of uninsured deposits will be determined once the FDIC obtains additional information from the bank and customers. Is the 3% figure from SVB or an estimate from another source?
Re: FDIC Takes over Silicon Valley Bank
#28It's kind of amazing how much optimism there was just an hour ago regarding SVB's position.
There's a strong correlation here to people who have deposits in SVB. This was all but certain yesterday.
Re: FDIC Takes over Silicon Valley Bank
#29Turns out Twitter making bank failure a meme didn’t really help anything at all. It’ll be very interesting to see what happens to uninsured depositors
Probably a dumb question, but what determines if a deposit is insured or not at an FDIC insured bank?
Re: FDIC Takes over Silicon Valley Bank
#30some note i've been taking
> To protect insured depositors, the FDIC created a new entity called the Deposit Insurance National Bank of Santa Clara, or DINB. DINB will maintain Silicon Valley Bank’s normal business hours, with banking activities resuming no later than Monday, including online banking and other services, the FDIC said. Customers with accounts in excess of $250,000 are being told to contact FDIC direclty
> The company’s main office and all Silicon Valley Bank branches will reopen on Monday,
> Uninsured depositors will get a receivership certificate for the remaining amount of their uninsured funds, the FDIC said
Keep in mind 93% of SVB's assest were not FDIC insured.
> Silicon Valley Bank Had About $209.0B in Assets
> Svb Is First FDIC-Insured Institution to Fail This Year
Their recent attempt to raise money via shares and debt sales failed,