The California Department of Financial Protection closed Silicon Valley Bank on Friday. It is the first FDIC-insured institution to go bankrupt following the October 23, 2020 closure of Almena State Bank in Almena, Kansas. Photo courtesy of Darren415/Shutterstock
March 10 (UPI) — The California Department of Financial Protection closed Silicon Valley Bank on Friday, making it the first FDIC-insured bank to fail in more than two years, federal officials said.
This was reported by the Federal Deposit Insurance Corporation. he was designated as a beneficiary to protect insured deposits. The FDIC said in a statement that it created the Santa Clara National Deposit Insurance Bank to help the bank’s customers.
It is the first FDIC-insured institution to go bankrupt following the October 23, 2020 closure of Almena State Bank in Almena, Kansas. Silicon Valley Bank’s total assets were about $209 billion and total deposits were about $175.4 billion. year. The number of deposits when closing in excess of the insurance limits was not determined.
The number of uninsured deposits will be determined after the FDIC receives additional information from the bank and customers.
The FDIC said Silicon Valley Bank, which has 17 branches in California and Massachusetts, will reopen on Monday in accordance with DINB during regular business hours.
“The FDIC will pay an upfront dividend to uninsured depositors over the next week,” the FDIC said in a statement. Uninsured depositors will receive a management certificate for the remaining amount of their uninsured funds.”
On Thursday, shares of SVB Financialwhich the Bank of Silicon Valley uses to lend to tech startups, said it would raise $2 billion in capital by offsetting losses from the bond sale.
Shares of Signature Bank, one of the main banks dealing with cryptocurrencies, fell 32% on Friday, and at some point trading stopped due to volatility. Trading in shares of First Republic Bank, PacWest Bancorp and Western Alliance Bancorp was also halted.