For now, Silicon Valley Bank will not be bailed out, the US Treasury secretary said on Sunday, after learning of the collapse of the country’s 16th-largest financial institution, now the focus is on customers worried about their money.
The bank is among the 20 largest banks in the United States with $175 billion in deposits. Efforts are now being made to bring calm to customers who are mostly new companies in the technology sector.
While the Federal Reserve and the Federal Deposit Insurance Corporation attempt to find a buyer for the bank, the Treasury is working on options for accounts over $250,000 that were uninsured.
It would be the second biggest banking meltdown in history after the 2008 financial crisis.
Greg Becker, CEO of Silicon Valley Bank, told his employees for the past few hours, “My ultimate goal is to figure out how to preserve what we’ve built for so many years with the right buyer who can work with him. the Federal Deposit Insurance Corporation so that this institution continues with many of you”.
Silicon Valley Bank primarily served tech workers and start-ups, but Financial Identity began to slide toward insolvency when many of its customers began withdrawing their deposits, saying they needed cash while struggling to obtain financing.
The financial collapse of Silicon Valley Bank has raised concerns about the future of other banks, but there is no indication that the situation could lead to a crisis similar to that of 2008.
Several economists consulted said that it is too early to comment on the matter because it is a situation that requires time to know if there is a solution or if it can actually infect other banking entities, but they s agree that for the moment this is not a cause for alarm.