👀 Copy Legendary Investors' Portfolios in One ClickCopy For Free

SVB Financial Group shut down by regulators

Published 03/10/2023, 12:51 PM
Updated 03/10/2023, 01:03 PM
© Reuters.  SVB Financial Group (SIVB) shut down by regulators
SIVBQ
-

By Sam Boughedda

In the latest update regarding the rapidly moving SVB Financial Group (NASDAQ:SIVB) saga, the Federal Deposit Insurance Corporation (FDIC) said Friday that SVB has been shut down by the California Department of Financial Protection and Innovation.

The regulator, which appointed the Federal Deposit Insurance Corporation as receiver, revealed that the FDIC created the Deposit Insurance National Bank of Santa Clara (DINB) to protect insured depositors.

"The FDIC as receiver immediately transferred to the DINB all insured deposits of Silicon Valley Bank," the FDIC said in a statement.

They added that all insured depositors will have access to their insured deposits no later than Monday, March 13.

The FDIC said it will pay uninsured depositors an advance dividend within the next week. For any remaining uninsured funds, depositors will receive a receivership certificate. As the FDIC sells the assets of Silicon Valley Bank, future dividend payments may be made to certificate holders.

The SVB plunge started Thursday after it revealed it had to sell billions of dollars worth of securities at a loss and was seeking to raise $2.25B in equity to shore up its balance sheet. This caused a wave of concerns, hitting other bank stocks in the process.

As of December 31, 2022, SVB had around $209B in total assets and approximately $175.4B in total deposits, although the FDIC said that at the time of closing, the amount of the 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," they added.

They also confirmed that the DINB will maintain SVB's normal business hours, with banking activities resuming by Monday.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.