Biden says Silicon Valley bank managers will be fired
Wall Street opened higher on Tuesday as inflation data came in better than expected and regional bank stocks bounced back from a sharp fall on Monday following the collapse of Silicon Valley Bank (SVB).
Six regional financial institutions remain under scrutiny, but the regulators’ response to protecting savers may have eased market fears.
However, Moody’s downgraded its outlook for the entire US banking system from stable to negative “to reflect the rapidly deteriorating operating environment.”
Meanwhile, the US Securities and Exchange Commission and the Department of Justice have reportedly launched investigations into SVB’s bankruptcy and any stock dealings undertaken by management ahead of its Friday shutdown. The investors also filed a class action lawsuit against the parent company, the CEO and the CFO.
Tim Maiopoulos, newly appointed CEO of SVB, said the bank open again for businessby opening new accounts and issuing new loans. He served as CEO of Fannie Mae, bringing it back to profitability after the 2008 financial crisis.
Elsewhere, Wall Street pundit Robert Kiyosaki, famous for predicting the collapse of Lehman Brothers, called Credit Suisse the next big bank most likely to collapse.
New Silicon Valley Bank CEO Brings Experience and ‘Humility’
In a message to clients, newly appointed CEO of Silicon Valley Bank Tim Maiopoulos says, “I look forward to getting to know the clients of Silicon Valley Bank. I approach this role with humility. I also approach this role with experience in similar situations.”
He explains: “I was part of the new leadership team that joined Fannie Mae after the financial crisis of 2008-2009, and from 2012 to 2018 I served as CEO of Fannie Mae. I am very proud of the work we have done to restore the company’s profitability and stabilize the housing finance system at a time of unprecedented challenges.”
Mr Maiopoulos adds: “I also have experience and understanding of the innovation economy. Until recently, I was the president of a Silicon Valley-based software company that provides technology to financial institutions to serve their consumer banking clients. I know how important the Silicon Valley bank has been and continues to be to the success of its clients and the innovation ecosystem.”
Premium: Has Enough Been Done to Calm Wall Street in the Banking Crisis?
James Moore, Granthshalachief business columnist, writes:
Just what we needed right now: another banking crisis. But after the bloodbath at the beginning of the week, the rally quickly began. Regional banks in the United States, which are in real danger of running out of deposits while larger competitors benefit from inflows, have found some support.
Has enough been done to appease Wall Street over the banking crisis?
If markets remain calm, the collapse of the Silicon Valley bank will be a useful lesson, says James Moore.
New Silicon Valley Bank CEO: ‘We’re open for business’
Tim Maiopoulos, the new CEO of Silicon Valley Bank, now known as Silicon Valley Bridge Bank, announced that the bank is open for business.
In the message posted on the company’s website and in an email to clients, Mr Maiopoulos said: “We are doing everything we can to restore, reclaim your trust and continue to support the innovation economy. We understand that the past few days have been an extremely challenging time and we thank you for your patience.”
He continued: “We are open for business and are working hard to bring all systems and solutions back online to support you. We issue new loans and fully service existing credit lines.
“The first thing you can do to support the future of this institution is to help us rebuild our deposit base by leaving deposits at Silicon Valley Bridge Bank and returning deposits from the past few days.”
Highlighting yesterday’s statement that depositors have full access to their money and that both new and existing deposits are fully protected by the FDIC, he described the bank as one of the safest in the country thanks to the actions of the regulators.
The bank is actively opening new accounts of all sizes and issuing new loans, Mr Maiopoulos added.
First “Twitter-driven bank run”
House Financial Services Committee Chairman Patrick McHenry (R-NC) on Friday called the Silicon Valley bank collapse “the first Twitter-fuelled bank run.”
In a statement, he said: “This was the first bank run fueled by Twitter. At this time, it is important to keep your cool and look at facts, not speculation, when evaluating the right path forward. I have confidence in our financial regulators and the safeguards already in place to keep our financial system safe and sound. ”
He joined the CNBC program this morning. Squokbox to underscore his statement by saying, “I want to give the American people confidence that these agencies are doing the right thing.”
The entire interview segment can be viewed here:
Silicon Valley bank demise destroys tech innovators
The collapse of Silicon Valley Bank shook the tech industry that had been the backbone of the bank, leaving shell-shocked entrepreneurs to thank the government for the delay that saved them money, while they mourned the loss of a place that served as a friendly innovation club.
Read more:
The demise of the Silicon Valley bank undermines revolutionary technological processes
The collapse of Silicon Valley Bank shook the tech industry that had been the backbone of the bank, leaving shell-shocked entrepreneurs to thank the government for the delay that saved them money, while they mourned the loss of a place that served as a friendly innovation club.
Lawmaker’s explanation for Silicon Valley Bank’s collapse goes viral
The congressman received widespread praise for posting a two-and-a-half-minute video on Twitter and TikTok clearly outlining the Silicon Valley bank situation.
Chapel Hill-born North Carolina Democrat Jeff Jackson was elected to the U.S. House of Representatives from the state’s 14th district in 2022.
At 2 a.m. Monday, he made a social media video explaining how the Silicon Valley bank crisis started, what is being done about it, and to prevent panic.
Read more:
North Carolina legislator’s video explanation of SVB collapse earns online praise
‘This is very good. Can you explain… everything?
Six regional US banks under scrutiny
Moody’s Investors Service put six other US banks under review for possible downgrades late on Monday following the collapse of Silicon Valley Bank. The credit rating agency also downgraded Signature Bank to trash territory.
The firm’s watchlist includes First Republic Bank, Zions, Western Alliance, Comerica, UMB Financial and Intrust Financial. Moody’s cited “extremely volatile funding conditions for some US banks exposed to the risk of an outflow of uninsured deposits.”
Shares in regional banks fell sharply on Monday, despite the fact that the federal government stepped in to prevent further bank runs.
When markets opened on Tuesday, shares of regional banks rose strongly.
Watch: UrbanStems CEO Talks About 100% Cash With SVB
BUT New York Regulator Says Signature Bank Shutdown “Has Nothing To Do With Cryptocurrency”
The New York financial regulator dismissed former Rep. Barney Frank’s comments, saying his decision to close Signature Bank “had nothing to do with crypto”, citing what he called a “significant crisis of confidence in the bank’s leadership” that occurred in weekend. after regulators shut down the Silicon Valley bank.
Mr. Frank is a board member of Signature Bank and was one of the pioneers of the landmark Dodd-Frank Act, which was enacted in the wake of the 2008 financial crisis to better protect the banking system from shocks.
“I think part of what happened was that regulators wanted to send a very strong anti-crypto message,” Mr. Frank told CNBC on Monday. “We became the personification because there was no bankruptcy based on fundamental principles.”
But the NYDFS denied his claims in a statement Tuesday, saying his decision to close Signature Bank on Sunday and appoint the Federal Deposit Insurance Corporation as the recipient “was based on the bank’s current status and its ability to conduct business safely and securely.” on Monday.
“Decisions made over the weekend had nothing to do with cryptocurrencies. Signature was a traditional commercial bank with a wide range of activities and clients,” said a spokesman for the NYDFS.
“DFS promotes well-regulated crypto-currency activities for…
Credit: www.independent.co.uk /