The U.S. Federal Deposit Insurance Corporation is reportedly holding an auction for the assets of failed Silicon Valley Bank of California this weekend, while discussions are also said to be underway involving the Federal Reserve to possibly create a fund to protect depositors. Meanwhile, the U.K. government said Sunday it was working on a lifeline for companies that had deposits locked up at Silicon Valley Bank’s British arm.
The FDIC began an auction process late Saturday for Silicon Valley Bank, with final bids due by Sunday afternoon, Bloomberg reported Sunday. The FDIC is hoping for a quick deal but a winner may not be known until late Sunday, and it is possible no deal will be reached, sources told Bloomberg. Representatives for the FDIC didn’t immediately respond to requests for comment. Silicon Valley Bank, the 16th largest lender in the U.S., collapsed into FDIC receivership on Friday, after its customer base of technology startup businesses became concerned and withdrew deposits. At the end of last year, SVB had more than $175 billion in deposits, most of which are uninsured, and also held $209 billion in total assets. Trading in shares of SVB
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were halted on Friday amid reports it’s seeking a buyer. See: Silicon Valley Bank branches closed by regulator in biggest bank failure since Washington Mutual The FDIC is now working on selling the assets and making a portion of clients’ uninsured deposits available as soon as Monday, sources said. The agency has said it will make 100% of insured deposits available on Monday, when Silicon Valley Bank branches reopen. Meanwhile, discussions are reportedly also under way between the Federal Reserve and the FDIC to possibly create a fund to protect more depositors from other troubled banks, following the nation’s first bank failure since late 2020, Bloomberg also reported. The Fed and the FDIC, which is charged with protecting depositors of insured U.S. banks, have been talking to financial institutions about a way to quell panic as questions hang over how some Silicon Valley Bank customers will get t …