DEVELOPING: FDIC Auction Underway for Silicon Valley Bank

FDIC auction was underway on Sunday for Silicon Valley Bank.

The final bids are due on Sunday.

“The Federal Deposit Insurance Corp. kicked off an auction process late Saturday night for Silicon Valley Bank, with final bids due by Sunday afternoon, according to people familiar with the matter,” Bloomberg News reported.

The ‘winner’ of the auction may not be known until late Sunday, Bloomberg said.

A deal may not even be reached.

Silicon Valley Bank reportedly held $173 billion in deposits.

The Fed interest rate is at 4.57% and $117 billion of Silicon Valley Bank securities are yielding only 1.56-1.66% – this is causing a run on the bank.

By Friday Silicon Valley Bank was in FDIC receivership.

The Federal Reserve caused the run on the bank by raising interest rates seven times in 2022.

2022’s rate hikes totaling 450 basis points is causing problems for bankers because investors want to move their money into higher-yield bonds.

Several companies have disclosed exposure with SVB.

Circle, Roku, Roblox and BlockFi are just a few companies that took a big hit after Silicon Valley Bank collapsed.

First Republic Bank’s stock tumbled on Friday and depositors were seen lining up at a Los Angeles branch to withdraw their money.

The Federal Deposit Insurance Corp. (FDIC) and Federal Reserve are discussing creating a fund to backstop deposits if more banks fail following the collapse of Silicon Valley Bank.

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Cristina began writing for The Gateway Pundit in 2016 and she is now the Associate Editor.

You can email Cristina Laila here, and read more of Cristina Laila's articles here.


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