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  • A bank CEO explains how the Silicon Valley Bank failure could actually build trust in the system and why it'll have little impact on Fed policy

    11 days ago - By Business Insider

    Silicon Valley Bank NurPhoto / Getty
    The government response to SVB's failure is a chance to boost Americans' confidence in the system.
    That's according to the CEO of Capra Bank, who said protecting deposits is of highest importance.
    He added that the episode will likely not impact on Fed policy, as inflation is still its top concern.
    Silicon Valley Bank's failure and regulators' response could ultimately boost Americans' confidence in the financial system, according to Tut Fuller, the founder and chief executive of Capra Bank, a community bank in Iowa. Over the last three days, regulators...
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  • Stablecoin USDC rises back toward $1 as $3.3 billion in Silicon Valley Bank to be made available following fears uninsured deposits could be lost

    11 days ago - By Business Insider

    Yuichiro Chino
    USDC was close to regaining its peg to the dollar on Monday after breaking below that level amid SVB's collapse.
    Stablecoin issuer, Circle, said it had $3.3 billion in cash reserves at the bank.
    Those funds would be made fully available after the government's bailout of depositors over the weekend.
    It's been a tumultuous week for the world's second-largest stablecoin, USDC, after one of crypto's key banking on-ramps collapsed. The USD coin lost its dollar peg after its issuer, Circle, said it had $3.3 billion in cash reserves held at the fallen Silicon Valley Bank. The USD...
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  • Why one firm says the failure of Silicon Valley Bank could be a positive for the stock market

    11 days ago - By Business Insider

    Silicon Valley Bank employees react to the bank's collapse Getty Images
    Stocks will benefit from Silicon Valley Bank's collapse, Fundstrat's Tom Lee said.
    "In other words, we think the Fed could move away from 'higher for longer' to a possible pause."
    He previously forecast the the S&P 500 rallying to 4,250 by the end of April.
    The Silicon Valley Bank failure is actually good news for stocks, and the market could be set up to post double-digit gains this year, according to Fundstrat's head of research Tom Lee. In a note on Monday, he pointed to the collapse of Silicon Valley Bank as a...
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  • Paul Krugman says Silicon Valley Bank 'was a kind of affinity fraud a la Madoff' because it sold itself on false pretenses

    11 days ago - By Business Insider

    Paul Krugman. REUTERS/Brendan McDermid
    Paul Krugman said 'what SVB actually did was a kind of affinity fraud a la Madoff.'
    SVB convinced tech startups it was trustworthy by selling itself under false pretenses, according to him.
    The Nobel Prize-winning economist is frustrated with this 'delusion marketing' that includes the crypto industry, too.
    Paul Krugman is taking issue with how Silicon Valley Bank portrayed itself to the tech startup world over the years, saying the lender relied on 'false pretenses' to gain clients' trust. In an 8-part Twitter thread , the Nobel Prize-winning...
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  • US stocks fall as investors brace for further impacts of Silicon Valley Bank's collapse

    11 days ago - By Business Insider

    US stocks fell on Monday as investors assess the potential fallout from the collapse of Silicon Valley Bank. Futures were initially higher after the Federal Reserve and US Treasury announced measures to limit the risk of further bank runs. Other banks that are now in focus include First Republic, PacWest Bancorp, and Charles Schwab. US stocks were lower on Monday after the Federal Reserve and US Treasury announced emergency measures to stop the spread of potential bank runs following the collapse of Silicon Valley Bank. The measures allow banks to pledge their Treasury securities that may...
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  • Charles Schwab plunges 19% as investors worry about banks sitting on big bond losses following Silicon Valley Bank collapse

    11 days ago - By Business Insider

    Drew Angerer/Getty Images Charles Schwab plunged 19% on Monday as investors dump shares of banks that have big unrealized losses on their bond portfolios. The decline comes after the swift implosion of Silicon Valley Bank, which was taken over by the FDIC on Friday. Charles Schwab has nearly $28 billion in unrealized losses across its held-to-maturity and available-for-sale bond portfolio. Investors are growing more and more concerned about the massive unrealized losses banks are sitting on in their bond portfolios following the swift collapse of Silicon Valley Bank on Friday. According to...
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  • Silicon Valley Bank's spectacular implosion shows how digital banking can decimate a lender in 24 hours

    11 days ago - By Business Insider

    Silicon Valley Bank was shut down by regulators on Friday. Getty Images
    Silicon Valley Bank's rapid implosion showed how bank runs can go at warp speed in the digital age.
    SVB's customers tried to withdraw funds at a rate of nearly $500,000 per second Thursday.
    Bank regulation rollbacks by President Trump in 2018 have also been blamed for SVB's demise.
    If the spectacular collapse of Silicon Valley Bank has shown us one thing, it's the speed at which a bank run can take place in the digital age. Panicked SVB clients tried to withdraw $42 billion from the bank on Thursday - equivalent to...
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  • Biden says taxpayers won't bail out Silicon Valley Bank and the people responsible for its collapse will be held accountable: 'No one is above the law'

    11 days ago - By Business Insider

    President Joe Biden delivers remarks on Monday over Silicon Valley Bank's collapse. Evelyn Hockstein/Reuters.
    Taxpayer funds will not bail out Silicon Valley Bank customers, President Joe Biden said Monday.
    Investors, on the other hand, face losses - "That's how capitalism works," he said.
    The bank's management will be fired, Biden said, signaling calls for accountability.
    When customers of collapsed Silicon Valley Bank get their deposits back , it won't be taxpayers who pick up the tab, President Joe Biden said in an address Monday morning. Instead, their funds would be restored through...
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  • Silicon Valley Bank's issues were hiding in plain sight, and its collapse damages the Fed's reputation as a regulator, DataTrek says

    11 days ago - By Business Insider

    Federal Reserve Board Chairman Jerome Powell. Yuri Gripas/Reuters
    If SVB's collapse isn't a one-off, the Fed's reputation is going to take a hit, DataTrek said.
    The Fed's "paradigm for assessing systematic risk needs a rethink," according to a Monday note.
    But Congress in 2018 exempted regional banks from tougher regulatory oversight.
    Silicon Valley Bank's problem's shouldn't have come as a surprise to the Federal Reserve, which faces damage to its reputation as a regulator, according to DataTrek Research. SVB's stunning collapse last week, leading to a federal rescue of its depositors on...
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  • Bitcoin rises and crypto market tops $1 trillion again after US regulators bail out SVB customers

    11 days ago - By Business Insider

    Bitcoin illustration Yuichiro Chino/Getty Images
    Bitcoin rose in a broad crypto rally Monday after US regulators bailed out customers of Silicon Valley Bank.
    The value of the total crypto market topped $1 trillion as fears around failed SVB and Signature Bank ebbed.
    Meanwhile, Circle said its $3.3 billion reserves in SVB would be available and its stablecoin would regain its peg.
    Bitcoin 's price jumped in a broad-based rally for cryptocurrencies Monday, after US regulators stepped in to bail out customers with money in Silicon Valley Bank. Cryptos were staging a comeback from recent...
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  • Everything you need to know about a crazy weekend in the wake of Silicon Valley Bank's failure

    11 days ago - By Business Insider

    What a weekend! Dan DeFrancesco in NYC. What do you think we've got for stories today? It's all about Silicon Valley Bank going down and the knock-on effects. If you're not up to speed, here's a quick rundown on what the hell happened at Silicon Valley Bank. In short, SVB built a reputation over the past 40 years catering to the tech community. But a perfect storm of rising interest rates, poor financial decisions, a terrible market for tech, and a bank run led to SVB's downfall essentially overnight. With $209 billion in assets at the end of 2022, it's the biggest US bank collapse since...
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  • A Silicon Valley Bank VP, whose grandmother and aunt also worked at the bank, said he's 'heartbroken' for startups affected by its implosion

    11 days ago - By Business Insider

    JP Giannini, a vice president at Silicon Valley Bank, said he's "hoping" everything works out for startups affected by the collapse. Justin Sullivan/Getty Images
    A vice president at Silicon Valley Bank said he is "heartbroken" for startups affected by its collapse.
    JP Giannini said both his grandmother and his aunt had previously worked at the bank.
    Silicon Valley Bank's implosion on Friday sent shockwaves through the tech sector.
    A Silicon Valley Bank vice president who worked at the lender for 13 years took to LinkedIn to share his thoughts about its collapse saying he's "heartbroken...
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