Treasury Secretary Janet Yellen arrives to testify on Capitol Hill on March 10. On Sunday, Yellen said the government would not bail out the Silicon Valley Bank.
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Treasury Secretary Janet Yellen arrives to testify on Capitol Hill on March 10. On Sunday, Yellen said the government would not bail out the Silicon Valley Bank.
Drew Angerer/Getty Images
Treasury Secretary Janet Yellen said that the US government would not bail out the Silicon Valley Bank as it did with other financial institutions during the 2008 financial crisis, but she noted that regulators Management is working to ensure that people and businesses with money in the bank fail are fully resolved.
“The reforms that have been made mean we won’t do it again,” Yellen said when asked about the bailout in a Sunday appearance on CBS’s Facing the Motherland.
“But we care about depositors and are focused on trying to meet their needs,” she added.
The fate of Silicon Valley Bank, or SVB, and its clients went on the air over the weekend, days after Federal regulators take control of the institution after the depositor “runs” into the bank.
Customers have flooded the bank with their withdrawal requests, and earlier last week SVB said it had to sell bonds at a heavy loss to meet those requests. That announcement exacerbated confusion about SVB’s financial situation and led to further withdrawal attempts until regulators stepped in.
The collapse of SVB marked one of the biggest failures of an American bank since the 2008 global financial crisis.
SVB has carved out a niche in the banking sector by lending money to tech startups, but recent financial problems facing the tech industry have put a strain on banks and causing its share price to drop.
Yellen said that, despite the collapse of SVB, she believes the US banking system as a whole is “really safe, well-capitalized” and “resilient”.
The Federal Deposit Insurance Corporation said on Friday that all insured depositors will have full access to their insured funds Monday morning at the latest. The agency also said it will pay uninsured depositors an “advance dividend” over the next week and depositors will be sent a “certificate of the remaining amount of the zero.” get their insurance.”
An independent federal agency, the agency FDIC does not use taxpayer money for deposit insurance, but rather financed through premiums paid by member banks and savings associations.
Regulatory bodies in the United Kingdom also working on a plan to ensure that customers of the UK branch of SVB have been paid.
The collapse of the bank has left technology companies and other SVB customers in limboand it even causes headaches for others not directly connected to the bank, such as Etsy sellers who are told they can see delay in receiving payment as the online marketplace uses SVB to make some payments.
