FINANCEREGULATION

Silicon Valley Bank resumes normal withdrawals, will continue seeking buyers

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Silicon Valley Bank resumes normal withdrawals, will continue seeking buyers

Silicon Valley Bank, after being rapidly taken over by the FDIC, has transferred all deposits to the interim bank, Bridge Bank, and has resumed normal operations, offering online banking and ATM services. Deposits are fully protected and available for immediate withdrawal as guaranteed by the regulatory authority. The regulatory agencies are planning a second round of bidding for Silicon Valley Bank, hoping to find a suitable acquirer.

Deposit Transfer to Bridge Bank

The FDIC has announced that all deposits of Silicon Valley Bank have been transferred to the Bridge Bank, which will operate during regular hours and provide online banking as well as ATM services. Tim Mayopoulos has been appointed as the new CEO of Silicon Valley Bank.

Note: A bridge bank is an institution established by a national regulatory authority or central bank to operate failed banks until a final buyer is found.

According to a client of Silicon Valley Bank and investor in multiple startups, Sheel Mohnot, who tweeted that he received an email from the current CEO, Tim Mayopoulos, emphasizing his professional background and understanding of the bank's importance in its customer and innovation ecosystem. He hopes to restore customer confidence through actions and continue to provide services to customers. Silicon Valley Bank has resumed its operations in the United States and is expected to resume cross-border transactions in the coming days.

Second Round of Bidding Opens

According to a report by Bloomberg, regulatory authorities are planning another measure to auction off the failed Silicon Valley Bank after failing to find a buyer over the weekend. Asset management company Apollo Global Management Inc. has shown interest in acquiring a portion of Silicon Valley Bank's loans. The former parent company of Silicon Valley Bank, SVB Financial Group, is also discussing the possibility of selling other subsidiaries, including SVB Capital and SVB Securities.

Yesterday, HSBC in the UK acquired Silicon Valley Bank's UK branch for 1 pound and plans to inject £2 billion of liquidity into the UK unit of SVB. Silicon Valley Bank is estimated to move towards a divestment direction.

According to a report by Reuters, the parent company, CEO, and CFO of Silicon Valley Bank are being sued by shareholders for fraud, alleging that they concealed the impact of rising interest rates on Silicon Valley Bank, leading to a run on the bank and its subsequent failure last week.