California regulators closed Silicon Valley Bank on Friday. The FDIC was named receiver.
Via Market Watch:
Silicon Valley Bank has been closed by the California Department of Financial Protection and Innovation, and the Federal Deposit Insurance Corporation (FDIC) has been appointed receiver, becoming the first FDIC-backed institution to fail this year. The news comes amid a crisis at parent SVB Financial Group SIVB, , which lost a record 60% of its value on Thursday, after it disclosed large losses from securities sales and announced a dilutive stock offering along with a profit warning. The FDIC said all insured depositors will have full access to their accounts no later than Monday morning. Uninsured depositors will get a receivership certificate and may be entitled to dividends once the FDIC sells the bank’s assets.
The bank reportedly holds $173 billion in deposits.
The crash could cause a recession.
The company provided funding to 44% of all venture capital-backed tech and healthcare companies that publicly listed on a stock exchange last year, according to its website.
Customers tried to pull millions of dollars out and can’t. Online banking and mobile services showing unavailable for some customers.
The Feds shut it down.
The CEO of Silicon Valley Bank sold $3.5 million in stock in the last two weeks!
It should have been obvious when Jim Cramer started propping it up last month.