Regulators rushed Friday to seize the $175-billion assets of one of Silicon Valley's top banks, marking the largest failure of a US financial institution since the height of the financial crisis almost 15 years ago, Ken Sweet reported for the Associated Press (AP).
Photo Insert: SVB served mostly technology workers and venture capital-backed companies, including some of the industry's best-known brands.
Silicon Valley Bank (SVB), the nation’s 16th-largest bank, failed after depositors hurried to withdraw money this week amid anxiety over the bank’s health. It was the second biggest bank failure in US history after the collapse of Washington Mutual in 2008.
The bank served mostly technology workers and venture capital-backed companies, including some of the industry's best-known brands.
Reporting for Time, Andrew R. Chow disclosed that the Federal Deposit Insurance Corp. (FDIC) took over SVB’s assets and noted that more than 85% of the bank’s deposits were uninsured since FDIC deposit insurance is meant for everyday bank customers and maxes out at $250,000.
Many Silicon Valley startups had millions, or even hundreds of millions of dollars deposited at the bank—money they used to run their companies and pay employees. Right now, nobody’s sure how much of that cash is left.