Posts Tagged ‘FDIC Deposits Are Uninsured’
While the FDIC Provides Deposit Insurance up to $250,000, Representing Less Than 10 Percent of Svb’s Deposits, the Vast Majority of Svb’s $173 Billion in Deposits Are Uninsured. According to the FDIC, It’s All Smoke and Mirrors, You Lose!
HNewsWire: SVB’s demise came suddenly (pdf). On Wednesday, the bank announced a loss of $1.8 billion from selling “available for sale” investment securities. Its holding company announced it would raise $2.25 billion to shore up the bank’s capital. Rather than comforting investors and depositors, this surprising announcement spooked them, “causing a run on the bank.” Within a few hours, depositors withdrew some $42 billion in cash, approximately 25 percent of total deposits, leaving the bank with a negative cash balance approaching $1 billion by the end of Thursday. Unable to shore up this shortfall overnight, the initially illiquid and then insolvent bank failed. California’s Commissioner of Financial Protection and Innovation took over the bank and appointed the FDIC as a receiver. Watchman: It started with all of the lockdowns. And what a coincidence that the president of SVB disposed off over 12,000……...Read More