Biden said Silicon Valley bank executives would be fired
Two top Silicon Valley bank executives have filed a class-action lawsuit over the company’s spectacular collapse.
The lawsuit names CEO Greg Becker and CFO Daniel Beck, who they accuse of intentionally misleading shareholders about SVB’s ability to manage risks.
It comes just hours after President Joe Biden called for the collapse of SVB, as the US government tries to avert a looming financial crisis.
Mr. Biden said that “there will be no cost to taxpayers. Instead, the money comes from commissions paid by banks to the deposit guarantee fund.
“The management of these banks will be dismissed. If the bank is taken over by the FDIC, the people who run the bank should no longer be working there,” Mr. Biden said.
The president said that “investors in banks are not protected.”
“They knowingly took a risk. And when the risk did not pay off, the investors lost their money. That’s how capitalism works,” he added.
“I’m asking Congress and banking regulators to strengthen regulations on banks so we can reduce the likelihood of bank failures happening again.”
Why did the Silicon Valley bank fail?
The collapse of the 16th largest U.S. bank sent shockwaves through global markets on Monday as governments and businesses scrambled to gauge what the impact would be and how to contain it.
On Monday, the UK government announced that HSBC would take over the bank’s UK wing.
But what happened to SVB, why did it collapse, and were other banks at risk? We address these questions here.
Oliver O’ConnellMarch 14, 2023 07:30
Central banks may “make it easier to raise rates.”
Some financial analysts say the collapse of the Silicon Valley bank could increase pressure on central banks to ease interest rate hikes.
Bestinvest private finance analyst Alice Hein said: “The collapse of two US banks in recent days, Silicon Valley Bank and Signature Bank, is a reminder of the risks that arise when central banks such as the US Federal Reserve raise interest rates. aggressive rates.”
Oliver O’Connell14 March 2023 05:45
Biden says the banking system is “safe” and has promised to hold Silicon Valley bank executives accountable
President Joe Biden has reassured Americans that the nation’s banking system is safe after the collapse of a Silicon Valley bank last week, and said financial leaders will be held accountable.
The president’s actions came after the Treasury Department, the Federal Reserve and the Federal Deposit Insurance Corporation announced late Sunday that Silicon Valley bank depositors would be able to access their money on Monday.
“No loss – this is an important point – there will be no loss to taxpayers,” the president said. “Instead, the money comes from commissions that banks pay to the deposit insurance fund.”
Eric Garcia reports Washington, DC.
Oliver O’ConnellMarch 14, 2023 03:45
Voices: Silicon Valley’s bank collapse made three things frighteningly clear
A Silicon Valley bank is not Lehman Brothers.
Over the weekend, we were bombarded with regulators, bank executives and pundits from every media outlet trying to paint SVB’s collapse as an outlier. But as shockwaves rippled around the world on Sunday, from Wall Street and London to Asia, it became clear that an entirely new and important asset class would now need to be protected: climate technology.
Oliver O’ConnellMarch 14, 2023 01:45
What you need to know about the collapse of the Silicon Valley bank
Two major banks powering the tech industry collapsed after the banks went bankrupt, government agencies are taking urgent steps to freeze the financial system, and President Joe Biden has reassured Americans that their money is safe in the banks.
All of this is reminiscent of the financial meltdown that began 15 years ago with the bursting of the housing bubble. However, this time the initial pace seems even faster.
In the past three days, the US has seized two financial institutions after a bank operating in Silicon Valley, based in Santa Clara, California. It was the biggest bank failure since Washington Mutual went bankrupt in 2008.
How did we get here? And are the steps announced by the government over the weekend enough?
Here are some questions and answers about what happened and why it matters:
The Silicon Valley Bank Collapse: What You Need to Know
Two major banks powering the tech industry collapsed after the bank failed, government agencies are taking urgent action to freeze the financial system, and President Joe Biden is reassuring Americans that their money is safe in the banks.
Oliver O’Connell14 March 2023 00:45
More than £50bn has been wiped out in a sell-off in FTSE 100 bank stocks
More than £50 billion was wiped from Britain’s biggest stock market on Monday after failures at the second- and third-largest banks in US history spooked investors around the world.
The collapse of the tech-focused Silicon Valley bank has fueled fears on Wall Street that the banking system is already under stress from a relentless cycle of interest rate hikes.
Oliver O’ConnellMarch 13, 2023 11:45 p.m
Premium: Silicon Valley bailout saves UK tech industry, but shares in other banks fall
Britain’s tech industry was rescued from a crisis on Monday after HSBC rescued the Silicon Valley bank’s UK arm in a deal brokered by the government and the Bank of England.
Oliver O’ConnellMarch 13, 2023 at 11:00 p.m
Startups, small businesses, and online sellers often despair of frozen inventory
It’s not just the big tech firms and venture capital funds left behind by Silicon Valley’s banking collapse. There are many small businesses, takeaways and online retailers affected by the sudden bank failure.
They range from business owners who can’t pay their employees to Etsy sellers who are worried about paying their bills because online payments have stopped.
Oliver O’ConnellMarch 13, 2023 10:15 p.m
Votes: Ghosts of 2008 financial crisis haunt Biden’s response to Silicon Valley bank
When President Joe Biden announced on Monday that money would be available to people who put their money in a now-open Silicon Valley bank, he stressed that American taxpayers would not be left on the hook.
Similarly, he said he was incomplete, arguing that the people responsible at the bank should be fired and that investors in Silicon Valley had taken risks and now had to suffer losses.
On the surface, the collapse of the Silicon Valley bank, as well as the closing of New York’s Signature Bank, seem remarkably similar to the 2008 financial crisis that brought down banks like AIG and led to the collapse of Lehman Brothers. At the time, Mr. Biden was a senator running for vice president with Barack Obama. Both of them and their opponent in the White House at the time voted for the Troubled Asset Relief Program, or TARP, known in the popular imagination as the “bailout.”
But there are important differences between 2008 and today.
Oliver O’ConnellMarch 13, 2023 9:45 p.m
Shopify CEO: ‘Very little impact for us’
Toby Lutke, CEO of e-commerce platform Shopify, shared an email offering merchants help if their funds were frozen at a Silicon Valley bank, and confirmed that the bank’s collapse had “very little impact for us.”
Oliver O’ConnellMarch 13, 2023 9:30 p.m