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U.S. government steps in and says people with funds deposited at SVB will be able to access their money
CNBC ^ | 03/12/2023 | Jeff Cox

Posted on 03/12/2023 9:09:03 PM PDT by SeekAndFind

Key Points

  • Regulators approved plans Sunday to backstop both depositors and financial institutions associated with Silicon Valley Bank.
  • Officials will unwind both SVB and Signature Bank, ensuring that depositors will have full access to their funds on Monday.
  • The Federal Reserve stepped in with a separate facility that will provide loans up to one year for institutions affected by the bank failures.
  • "Today we are taking decisive actions to protect the U.S. economy by strengthening public confidence in our banking system," leading regulators said in a joint statement.

Banking regulators devised a plan Sunday to backstop depositors with money at Silicon Valley Bank , a critical step in stemming a feared systemic panic brought on by the collapse of the tech-focused institution.

Depositors at both failed SVB and Signature Bank in New York, which was shuttered Sunday over similar systemic contagion fears, will have full access to their deposits as part of multiple moves that officials approved over the weekend. Signature had been a popular funding source for cryptocurrency companies.

Those with money at the bank will have full access starting Monday.

The Treasury Department designated both SVB and Signature as systemic risks, giving it authority to unwind both institutions in a way that it said “fully protects all depositors.” The FDIC’s deposit insurance fund will be used to cover depositors, many of whom were uninsured due to the $250,000 cap on guaranteed deposits.

Along with that move, the Federal Reserve also said it is creating a new Bank Term Funding Program aimed at safeguarding institutions affected by the market instability of the SVB failure.


(Excerpt) Read more at cnbc.com ...


TOPICS: Breaking News; Business/Economy; Government
KEYWORDS: bailout; depositors; fdic; svb
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To: BenLurkin; All

What are they going to do about all the other ones sitting on piles of sub 2.5% yielding mid to long term bonds as assets???


21 posted on 03/13/2023 12:37:00 AM PDT by Axenolith (WWG1WGA!)
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To: SeekAndFind

It is Silicon Valley. The Swamp is bailing out Democrats who donate to Swamp politicians and provide cover.


22 posted on 03/13/2023 1:53:34 AM PDT by UnwashedPeasant (The pandemic we suffer from is not COVID. It is Marxist Democrat Leftism.)
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To: Spok
It’s as though they want to ruin our economy.

There *is* a method to their madness.

23 posted on 03/13/2023 2:03:13 AM PDT by C210N (Everything will be okay in the end. If it’s not okay, it’s not the end.)
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To: SeekAndFind

Joseph Zeballos-Roig
@josephzeballos
Former Rep. Barney Frank (D-MA) endorsed changes to his own Dodd-Frank law in 2018 that freed mid-sized banks from undergoing stress tests. He sits on Signature Bank’s board, which just collapsed.

I reached him via phone tonight and he declined to comment
washingtonpost.com
A lot of people heard what Barney Frank said about the new banking law. Few knew he works for a...
8:26 PM · Mar 12, 2023


24 posted on 03/13/2023 2:07:02 AM PDT by mewzilla (We will never restore the republic if we don't first secure the ballot box.)
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To: SeekAndFind

... no taxpayer costs ...

And, the Mercedes is paid for.


25 posted on 03/13/2023 4:07:24 AM PDT by Oldeconomybuyer (The problem with socialism is that you eventually run out of other people's money)
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To: SeekAndFind

On a Sunday evening. Someone is panicked that there will be a bloodbath this morning when the bell sounds, and is trying to help soften the blow.


26 posted on 03/13/2023 4:22:24 AM PDT by Abathar (Proudly posting without reading the article carefully since 2004)
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To: Abathar

“What are they going to do about all the other ones sitting on piles of sub 2.5% yielding mid to long term bonds as assets???”

What do they care? The Dems just took care of their Silicon Valley big tech woke donors.


27 posted on 03/13/2023 4:41:47 AM PDT by BushCountry (A properly cast vote (1 day voting) can save you $3.00 a gallon.)
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To: SeekAndFind

So the money there to protect other banks also up to 250k is being used to give svb depositors their UNINSURED portions?

Can someone clarify if I interpreted that correctly?


28 posted on 03/13/2023 5:07:33 AM PDT by DrewsMum
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To: SeekAndFind

...and other banks gets its money from where?


29 posted on 03/13/2023 5:10:35 AM PDT by devane617 (Discipline Is Reliable, Motivation Is Fleeting..)
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To: Axenolith
Re: "Piles of sub 2.5% bonds"

As long as the SVB borrowers are not defaulting, and as long as the SVB bond reserves are all investment grade, I do not understand where the panic is coming from.

The $21 billion bond portfolio that SVB sold for a $1.8 billion loss was only 8.5% under water, and only because of inflation and Federal Reserve rate increases.

What motivated thousands of SVB depositors to line up on the same day and withdraw all their money?

That is crazy. Exactly the same thing can happen at the next bank they put their money in.

30 posted on 03/13/2023 5:57:39 AM PDT by zeestephen (43,000)
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To: UnwashedPeasant

You can read up on her career, a past (Clinton Appointed) Federal Reserve Chairman herself...

Janet Yellen - Wikipedia
https://en.wikipedia.org/wiki/Janet_Yellen

Supposed to be VERY SMART people running the Fed.

“Unintended Consequences” . . . :<<<


31 posted on 03/13/2023 5:59:44 AM PDT by Texan4Life
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To: BushCountry

Time for a New Crash Movie....


32 posted on 03/13/2023 6:01:34 AM PDT by Texan4Life
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To: Texan4Life

Yeah, but can Janet make a good sandwich?


33 posted on 03/13/2023 6:02:24 AM PDT by who knows what evil? (Yehovah saved more animals than people on the ark...siameserescue.org)
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To: DrewsMum
Re: "Can someone clarify if I interpreted that correctly?"

That is the same way I understand it.

They are trying to confine the entire bail out to the FDIC.

The FDIC, I believe, is 100% funded by member banks.

Therefore - no politically inconvenient deficit spending assigned to the Biden budget.

34 posted on 03/13/2023 6:18:22 AM PDT by zeestephen (43,000)
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To: SeekAndFind

Bailouts are back !!!

https://www.investing.com/news/economy/bailouts-are-back-fed-outlook-reassessed-pfizer-ma—whats-moving-markets-3028856

Feds bail out tech bros

Federal authorities bailed out depositors in Silicon Valley Bank (NASDAQ:SIVB) and Signature Bank (NASDAQ:SBNY), aiming to head off a run on the country’s second-tier regional banks.

The Federal Reserve, Federal Deposit Insurance Corporation and the Treasury said they will make sure the two banks honor all of their deposits, the vast majority of which are above the $250,000 federally-insured threshold.

They also set up a new instrument, named the Bank Term Funding Plan (BTFP), which will allow banks to sell Treasury bonds and other high-quality liquid assets to the Fed at par if they need to raise liquidity. The program will be back-stopped by $25B of taxpayers’ money.

The move means that the banks’ clients, many of them venture capitalists and crypto platforms, will not have to carry the can for what appears to have been startlingly elementary risk management failures at the two banks.


35 posted on 03/13/2023 6:19:48 AM PDT by Texan4Life
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To: SeekAndFind

It might have been an error for the California Bank regulators to put SVB into receivership. Apparently the bank was illiquid but not insolvent. ANY bank can become illiquid due to a run on the bank.


36 posted on 03/13/2023 6:24:59 AM PDT by devere
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To: SeekAndFind

Biden wasted no time this morning blaming DJT for these bank failures.


37 posted on 03/13/2023 6:27:00 AM PDT by NautiNurse (There was a 2022 mid-term Red Wave...in Florida! )
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To: devere

It’s scary that SVB went belly up because it invested in Mortgage Backed Securities. The Fed has been one of the largest buyers of MBS over the past ten years.

In January they started thinking they might want to start selling them.

If they had to “mark to market” it would be a very bad thing.


38 posted on 03/13/2023 6:28:00 AM PDT by Vermont Lt
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To: SeekAndFind

So who will pay the price for losses at the banks?
Where did govt get the money to do anything?

You got it. It is always taxpayers at end of day
That fugly national debt is liability for future taxpayers.
Government does not produce anything to sell in the economy and make profits. Govt has only 2 sources for funds
1. Taxes
2. Borrow by printing


39 posted on 03/13/2023 6:28:51 AM PDT by entropy12 (Food is most popular anxiety drug, exercise is the least popular.)
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Now, for God’s sake, someone step in and crash CRE with an IndyMac letter like Schumer did to Shrub, and let the White Hospice ride the Hindenberg the short ride down.

Welcome back, President Trump.

40 posted on 03/13/2023 7:03:43 AM PDT by StAnDeliver (Tanned, rested, and ready.)
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