FDIC Takes Over Silicon Valley Bank to Protect Insured Depositors
The FDIC shuts down Silicon Valley Bank and creates a temporary bridge bank to ensure customers retain access to their insured funds. All 17 branches reopen on Monday morning as the agency begins liquidating the failed institution's assets.
The California Department of Financial Protection and Innovation closes Silicon Valley Bank and appoints the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect customers, the FDIC creates the Deposit Insurance National Bank of Santa Clara (DINB) and immediately transfers all insured deposits to this new entity. Silicon Valley Bank holds approximately $209.0 billion in total assets and $175.4 billion in total deposits at the time of the closure.
All insured depositors gain full access to their funds no later than Monday morning, March 13, 2023. The main office and all 17 branches in California and Massachusetts reopen on Monday to maintain normal business hours, including online banking and check clearing. Meanwhile, the FDIC issues an advance dividend to uninsured depositors within the next week and provides receivership certificates for the remaining balances.
Customers with accounts exceeding the standard $250,000 insurance limit need to contact the FDIC directly for assistance. The agency retains all of Silicon Valley Bank's assets for later disposition and instructs loan customers to continue making their payments as usual. As the FDIC sells off these assets, future dividend payments potentially go to the uninsured depositors who lost funds in the first FDIC-insured bank failure of the year.