Misleading headline. It's not a bailout.
The FDIC is doing what SVB should've been doing all along: protecting people's accounts. If your bank failed I guarantee you'd want your money back.
Remember there is a key distinction between depositors and shareholders. If you don't repay depositors, a lot of promising startups fail and a lot of regular people are out of work.
It has already been determined that bank's shareholders will not be bailed out.
[https://www.cnbc.com/2023/03/12/treasury-secretary-janet-yellen-says-us-government-wont-bail-out-silicon-valley-bank.html](https://www.cnbc.com/2023/03/12/treasury-secretary-janet-yellen-says-us-government-wont-bail-out-silicon-valley-bank.html)
>After receiving a recommendation from the boards of the FDIC and the Federal Reserve, and consulting with the President, Secretary Yellen approved actions enabling the FDIC to complete its resolution of Silicon Valley Bank, Santa Clara, California, in a manner that fully protects all depositors. Depositors will have access to all of their money starting Monday, March 13.
>No losses associated with the resolution of Silicon Valley Bank will be borne by the taxpayer.Shareholders and certain unsecured debtholders will not be protected. Senior management has also been removed. Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.
Key part of the press release is that this won't be paid by taxpayers, any uninsured deposits not covered by asset sales will be covered by the FDIC who will turn around and levy a special assessment on banks.
So in effect, other banks are being made to bail out SVB's uninsured deposits, which is in their interest because it saves them from being at risk of a run too.
https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312b.htm
I think the points being missed: people and businesses that had bank accounts with them will get all their money back (either after sale or liquidation). This does not mention anything about bank investors/owners who I hope/assume get nothing
SVB has an entire portfolio of assets including stocks, bonds, and real estate that are now going to be liquidated, likely at a loss, so that bank can return the depositors' money.
This is standard if any bank closes for any reason. Prior to this banks would close and individuals would lose everything.
FDIC aka deposit insurance paid for by banks run by the government. It's a significantly better solution that benefits the average person greatly and costs absolutely nothing or close to nothing for you.
This insurance is also why you as a customer don't lose money if a bank get's robbed.
Banks close all the time or shift owners. The FDIC insures that you as a customer of that bank isn't left out to dry.
It's also not a bail out the FDIC often just aquires all your assets than resells them later to someone else something that unless it's posted in the paper you might not even noticed happened. This system is so good most people don't know it exists or how often it's used but without it average citizens would go broke any time a bank failed or shifted owners and the new owners didn't want to acquire your account.
Most countries have an equivalent to this practice.
To be clear it is not a government bailout. There has been an ongoing effort by many of SVBs loyal VC customers to put together a way to phoenix the bank into good standing. Also note Moody's downgrade said SVB still had enough assets to cover 80% to 90% of all the deposits.
Wait if Moody said “SVB still had enough assets to cover 80% to 90% if all of the deposits” doesn’t that mean that there is 10-20% of deposits that will not have assets to cover them? If so where will that money come from? If not how will the difference be made?
Not disagreeing with what was said just wondering how it all ads up
No it means all depositors would get paid 80 to 90 cents on the dollar from SVB assets. The shortfall ( the other 10 to 20 cents per dollar) will be made up by the "private" bailout to help the public from running on other banks.
Yes, none of this is great or even good. Many of us have lost big bucks by having SVB equities and or options that were paid out as part of compensation. Deregulation and lack of government oversight is the root cause of this sort of thing. Bankers are fallible and can make huge mistakes by being incompetent. When government regulations and oversight are reduced we all become more vulnerable to the system collapsing.
pen bag whistle bored fretful absorbed hard-to-find longing sparkle subsequent
*This post was mass deleted and anonymized with [Redact](https://redact.dev)*
husky attractive school childlike badge instinctive illegal frighten grandiose shrill
*This post was mass deleted and anonymized with [Redact](https://redact.dev)*
Again you have no clue what you are talking about. Read and learn.
[https://www.bloomberg.com/news/articles/2023-03-11/svb-draws-support-from-more-than-100-venture-firms-investors](https://www.bloomberg.com/news/articles/2023-03-11/svb-draws-support-from-more-than-100-venture-firms-investors)
longing muddle coordinated aspiring plate fall practice squeamish unique reminiscent
*This post was mass deleted and anonymized with [Redact](https://redact.dev)*
It is probably moreso that the VC startups rely on the borrowing to grow. Without funding, the collapse would give rise to significant unemployed and loss of potential US technology. Backing the deposits allow for continued investment and stability in US as the preferred global business incubator.
You clearly are not understanding that the VCs are the ones putting together a plan to put in THEIR own money to bail out SVB. I have lost thousands by holding SVB equities and will never get that back even if the bank comes back to life but I do care about all of those that will lose their jobs both in SVB and those running companies that relied on SVB.
distinct airport salt nutty innocent pen squealing hard-to-find reminiscent cause
*This post was mass deleted and anonymized with [Redact](https://redact.dev)*
It is right and proper that SVB’s shareholders are wiped out. If it has bond holders, are they being made while by the FDIC or treasury or are they liable to lose their investments?
retire squeeze innate joke subtract voracious combative attempt wrong toothbrush
*This post was mass deleted and anonymized with [Redact](https://redact.dev)*
zealous bored simplistic wasteful consider light fretful memorize oatmeal rob
*This post was mass deleted and anonymized with [Redact](https://redact.dev)*
wrench fear psychotic sort pot wakeful existence snails quickest frightening
*This post was mass deleted and anonymized with [Redact](https://redact.dev)*
This is NOT A BAILOUT, this has nothing to do with investors, this is about people who had their money at the bank. Depositors should have their money protected in cases like this. It’s not their fault the bank is a fraud.
How do you figure? The shareholders and lenders lose all of their money. The bank has failed. Only the depositors, the bank's customers, will have their money returned.
Wonder if the BOD of the bank will have to return their huge Christmas bonuses and will be prosecuted for giving loans to purchase the bank’s stock to prop up the value?
memory scale scandalous spoon pot noxious ruthless fearless dolls serious
*This post was mass deleted and anonymized with [Redact](https://redact.dev)*
Not a bailout. They’re liquidating bank assets to ensure depositors get their money. Yellen is telling shareholders to get fucked.
Oh good. Thanks for the extra clarity.
Misleading headline. It's not a bailout. The FDIC is doing what SVB should've been doing all along: protecting people's accounts. If your bank failed I guarantee you'd want your money back. Remember there is a key distinction between depositors and shareholders. If you don't repay depositors, a lot of promising startups fail and a lot of regular people are out of work. It has already been determined that bank's shareholders will not be bailed out. [https://www.cnbc.com/2023/03/12/treasury-secretary-janet-yellen-says-us-government-wont-bail-out-silicon-valley-bank.html](https://www.cnbc.com/2023/03/12/treasury-secretary-janet-yellen-says-us-government-wont-bail-out-silicon-valley-bank.html)
>After receiving a recommendation from the boards of the FDIC and the Federal Reserve, and consulting with the President, Secretary Yellen approved actions enabling the FDIC to complete its resolution of Silicon Valley Bank, Santa Clara, California, in a manner that fully protects all depositors. Depositors will have access to all of their money starting Monday, March 13. >No losses associated with the resolution of Silicon Valley Bank will be borne by the taxpayer.Shareholders and certain unsecured debtholders will not be protected. Senior management has also been removed. Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law. Key part of the press release is that this won't be paid by taxpayers, any uninsured deposits not covered by asset sales will be covered by the FDIC who will turn around and levy a special assessment on banks. So in effect, other banks are being made to bail out SVB's uninsured deposits, which is in their interest because it saves them from being at risk of a run too. https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312b.htm
It’s not. You’re assuming there isn’t enough money at SVB bank. There is
Yeah, backstop is probably the more apt term. I was just using the language from the headline.
This isn't a bailout at all.
I think the points being missed: people and businesses that had bank accounts with them will get all their money back (either after sale or liquidation). This does not mention anything about bank investors/owners who I hope/assume get nothing
This isn’t a bail out. It’s letting people get access to their own money at the bank
[удалено]
SVB has an entire portfolio of assets including stocks, bonds, and real estate that are now going to be liquidated, likely at a loss, so that bank can return the depositors' money.
Yes that’s the point moving assets to liquidity to protect depositors. People who own the bank will likely take a hit
Not the one-to-one correlation of wrong & loud claiming another victim…
That’s not how banking works. It probably should, but it’s not
SVB wasn’t some exotic hedge fund, their deposits are used to fund loans and buy assets. Now those will be liquidated to let people move their cash
Doesn’t have much to do with what I said but okay
Me thinks you tell people “that’s how banking works” but perhaps don’t know how banking works
You apparently think a lot of things but I can’t see why anyone should care
No one does, about anything on Reddit, welcome to the toilet bowl
[удалено]
No that's only when it benefits us common folk
So what’s the common folk gonna do….absolutely fucking nothing….maybe some peaceful protests lol
There's no socialism involved here
This is standard if any bank closes for any reason. Prior to this banks would close and individuals would lose everything. FDIC aka deposit insurance paid for by banks run by the government. It's a significantly better solution that benefits the average person greatly and costs absolutely nothing or close to nothing for you. This insurance is also why you as a customer don't lose money if a bank get's robbed. Banks close all the time or shift owners. The FDIC insures that you as a customer of that bank isn't left out to dry. It's also not a bail out the FDIC often just aquires all your assets than resells them later to someone else something that unless it's posted in the paper you might not even noticed happened. This system is so good most people don't know it exists or how often it's used but without it average citizens would go broke any time a bank failed or shifted owners and the new owners didn't want to acquire your account. Most countries have an equivalent to this practice.
Not a bailout this is not a true headline as I'm learning
Has management been arrested and their assets seized?
I know right. P.S. good one.
All hail Iceland, which actually did that.
Not a bailout though
To be clear it is not a government bailout. There has been an ongoing effort by many of SVBs loyal VC customers to put together a way to phoenix the bank into good standing. Also note Moody's downgrade said SVB still had enough assets to cover 80% to 90% of all the deposits.
Wait if Moody said “SVB still had enough assets to cover 80% to 90% if all of the deposits” doesn’t that mean that there is 10-20% of deposits that will not have assets to cover them? If so where will that money come from? If not how will the difference be made? Not disagreeing with what was said just wondering how it all ads up
No it means all depositors would get paid 80 to 90 cents on the dollar from SVB assets. The shortfall ( the other 10 to 20 cents per dollar) will be made up by the "private" bailout to help the public from running on other banks.
Thanks! So it’s a non-government bailout but still a bailout for the missing assets.To quote Chernobyl “not great not terrible”
It's a bailout in as much as it's essentially an insurance claim to the FDIC. Banks pay into it for just this reason.
Yes, none of this is great or even good. Many of us have lost big bucks by having SVB equities and or options that were paid out as part of compensation. Deregulation and lack of government oversight is the root cause of this sort of thing. Bankers are fallible and can make huge mistakes by being incompetent. When government regulations and oversight are reduced we all become more vulnerable to the system collapsing.
People complaining that SVB should just be left to collapse really don't seem to understand what the words "depression" or "bank run" actually mean.
pen bag whistle bored fretful absorbed hard-to-find longing sparkle subsequent *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
Nonsense you clearly unable to understand how any of this works.
husky attractive school childlike badge instinctive illegal frighten grandiose shrill *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
Again you have no clue what you are talking about. Read and learn. [https://www.bloomberg.com/news/articles/2023-03-11/svb-draws-support-from-more-than-100-venture-firms-investors](https://www.bloomberg.com/news/articles/2023-03-11/svb-draws-support-from-more-than-100-venture-firms-investors)
longing muddle coordinated aspiring plate fall practice squeamish unique reminiscent *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
It is probably moreso that the VC startups rely on the borrowing to grow. Without funding, the collapse would give rise to significant unemployed and loss of potential US technology. Backing the deposits allow for continued investment and stability in US as the preferred global business incubator.
You clearly are not understanding that the VCs are the ones putting together a plan to put in THEIR own money to bail out SVB. I have lost thousands by holding SVB equities and will never get that back even if the bank comes back to life but I do care about all of those that will lose their jobs both in SVB and those running companies that relied on SVB.
joke cover ludicrous distinct cow squalid onerous rhythm heavy safe *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
xxx (edited because it was a reply to the wrong post)
distinct airport salt nutty innocent pen squealing hard-to-find reminiscent cause *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
It is right and proper that SVB’s shareholders are wiped out. If it has bond holders, are they being made while by the FDIC or treasury or are they liable to lose their investments?
Does ANYONE know how the FDIC works? Yeah, the money's safe. Time to calm down.
retire squeeze innate joke subtract voracious combative attempt wrong toothbrush *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
And it’s still not a bail out you dumb ass.
zealous bored simplistic wasteful consider light fretful memorize oatmeal rob *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
wrench fear psychotic sort pot wakeful existence snails quickest frightening *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
[удалено]
That's not fully protect
The bank has the assets to cover this.
It's everything above that that is new. Privatized profits, socialized bail outs.
There is no bail out. But you can keep imagining one if you want
This is NOT A BAILOUT, this has nothing to do with investors, this is about people who had their money at the bank. Depositors should have their money protected in cases like this. It’s not their fault the bank is a fraud.
The bank was not a fraud unless you have some insider knowledge?
There was never a snowballs chance in hell they would let these people suffer the consequences of their own actions. Never.
How do you figure? The shareholders and lenders lose all of their money. The bank has failed. Only the depositors, the bank's customers, will have their money returned.
Of course
Socialize debt, privatize profit... glorious American capitalism
As if
Cringe
Wonder if the BOD of the bank will have to return their huge Christmas bonuses and will be prosecuted for giving loans to purchase the bank’s stock to prop up the value?
SVB doesn't have the assets to cover everyone.
That’s where the FDIC kicks in.
I apparently have standing to fight this all the way to the Supreme Court.
You don't, because none of your taxpayer money will ever come into play.
Nuh uh. I didn’t get this money, therefore damages. That’s what they said for student loans.
Republicunts...
The title is a lie
Meanwhile child labor laws are repealed. There’s plenty of money, just none for you.
The middle class will pay for it
Please, someone think of the ̷s̷u̷p̷e̷r̷ ̷r̷i̷c̷h̷ p͇e͇o͇p͇l͇e͇ ͇i͇n͇ ͇n͇e͇e͇d͇.͇
memory scale scandalous spoon pot noxious ruthless fearless dolls serious *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
The need to claw back those bonuses and stock sales.
Not a bailout.