The latest on the Silicon Valley Bank collapse: Live updates

10:57 a.m. ET, March 14, 2023

What the FDIC acquisitions of Silicon Valley Bank and Signature mean for their customers and employees

From CNN’s Jeanne Sahadi

Federal Deposit Insurance Corp. (FDIC) headquarters in Washington, DC, on Monday, March 13.

(Al Drago/Bloomberg/Getty Images)

Here’s where things stand for customers and employees of Silicon Valley Bank and Signature Bank, both of which failed this week and were immediately taken over by the FDIC.

Do customers want full access to all their money on deposit? Yes. The US government intervened over the weekend, assuring that the banks’ depositors will have access to all their money from Monday, March 13, and that losses related to SVB’s collapse will not be borne by taxpayers.

This means that customers will be able to access their insured deposits as well as their uninsured deposits from the “bridge bank” that the FDIC created for SVB deposits and the one it created for signature deposits.

Both SVB and Signature were FDIC insured. This means that the FDIC insures up to $250,000 per depositor for each account ownership category. Some customers may be insured for more than $250,000 if they had more than one type of deposit account, as each account is covered separately. What’s more, if more than one person owns an account jointly, each owner is covered up to $250,000.

But the three agencies’ move to also allow customers to access their uninsured deposits was critical. For example, most SVB customers are businesses and have much more than $250,000 in deposits because they used SVB for much of their cash handling, including payroll.
How can customers access their money? Customers can access their money through ATMs, debit cards and checks — just like before, according to the FDIC.
What about lines of credit? According to frequently asked questions specific to SVB and Signature closures, customers’ lines of credit have been transferred to the new bridge banks that the FDIC created to handle customers’ transferred deposits and banking services. The bureau notes that customers should contact the bank if they have questions about their credit lines.

Can customers continue to keep their money where it is? Yes, but the FDIC will communicate to customers how long they can continue to do so. So far, the FDIC has not set any end-of-service dates for SVB or Signature customers.

What if a customer has a loan through SVB or Signature? Customers with a loan must still pay to the same payment address even if the FDIC ends up selling the loan. Any changes will be notified.

Will SVB and Signature’s employees keep their jobs? Very likely, but maybe not for long. Typically, in an FDIC takeover, the employees of the failed bank are retained to help with the transition. Their wages and benefits are paid by the FDIC during that time. Should the FDIC find a buyer for one of the banks, it is the acquiring institution that determines whether the banks’ employees will stay.

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