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The recent failures of Silicon Valley Bank and Signature Bank, which catered mostly to the tech industry, may have you worried about your money. They were the second- and third-biggest bank failures in U.S. history.

It all started last week when too many depositors tried to withdraw their money from Silicon Valley Bank in Santa Clara, California. That’s known as a bank run.

The bank had to sell treasury bonds and other securities at a steep loss and more people kept trying to withdraw money as word of the situation spread, causing the bank to fail. Regulators took control of New York-based Signature Bank soon after, saying it was necessary to protect depositors after too many people withdrew money.

In response, regulators guaranteed all deposits at the two banks and created a program to help shield other banks to shield them from a run on deposits.

IS MY MONEY SAFE?

Continue reading “Is my money safe? What you need to know about bank failures”

President Joe Biden said Monday that people should “rest assured” after his administration acted to ease uncertainties about the banking system in the wake of the collapse of Silicon Valley Bank last week, the second-largest bank failure in U.S. history.

The president spoke about the actions taken by his administration to give the country confidence that the banking system is safe.

“Thanks to the quick action of my administration over the past few days, Americans can have confidence that the banking system is safe,” Biden said. “Your deposits will be there when you need them.”

Continue reading “Biden says ‘the banking system is safe’ after Silicon Valley Bank shutdown”

Financial regulators have closed Silicon Valley Bank and taken control of its deposits, the Federal Deposit Insurance Corp. announced Friday, in what is the largest U.S. bank failure since the global financial crisis more than a decade ago.

The collapse of SVB, a key player in the tech and venture capital community, leaves companies and wealthy individuals largely unsure of what will happen to their money.

According to press releases from regulators, the California Department of Financial Protection and Innovation closed SVB and named the FDIC as the receiver. The FDIC in turn has created the Deposit Insurance National Bank of Santa Clara, which now holds the insured deposits from SVB.