Watch SVB collapse latest news: Silicon Valley Bank hit with lawsuit for misleading stockholders after failure – Latest News
Biden says Silicon Valley Bank managers will be fired
Two top executives at Silicon Valley Bank have been slapped with a class-action lawsuit over the company’s stunning collapse.
The lawsuit names CEO Greg Becker and CFO Daniel Beck, alleging they knowingly misled stockholders SVB’s ability to navigate risks.
It comes hours after President Joe Biden addressed the nation regarding the SVB collapse, as the US government takes steps to try to prevent an escalating financial crisis.
Mr Biden said that “no losses will be borne by the taxpayers. Instead, the money will come from the fees that banks pay into the Deposit Insurance Fund”.
“The management of these banks will be fired. If the bank is taken over by FDIC, the people running the bank should not work there anymore,” Mr Biden said.
The president said that “investors in the banks will not be protected”.
“They knowingly took a risk. And when the risk didn’t pay off, investors lose their money. That’s how capitalism works,” he added.
“I’m going to ask Congress and the banking regulators to strengthen the rules for banks, to make it less likely this kind of bank failure would happen again.”
Central banks could ‘ease up on rate hikes’
The collapse of Silicon Valley Bank could fuel pressure on central banks to ease up on interest-rate hikes, according to some finance experts.
Alice Haine, a personal finance analyst at Bestinvest, said: “The collapse of two US banks in recent days, Silicon Valley Bank and Signature Bank, is a reminder of the risks that come when central banks, like the US Federal Reserve, raise interest rates aggressively.”
Oliver O’Connell14 March 2023 05:45
Biden says banking system is ‘safe’ and vows accountability for Silicon Valley Bank executives
President Joe Biden reassured Americans that the nation’s banking system is safe after Silicon Valley Bank collapsed last week and said there would be accountability for financial executives.
The president’s actions come after the Treasury Department, the Federal Reserve and the Federal Deposit Insurance Corporation announced on Sunday evening that depositors for Silicon Valley Bank would have access to their money on Monday.
“No losses — and this is an important point — no losses will be borne by the taxpayers,” the president said. “Instead the money will come from the fees that banks pay into the deposit insurance fund.”
Eric Garcia reports from Washington, DC.
Oliver O’Connell14 March 2023 03:45
Voices: The Silicon Valley Bank collapse has made three things horrifically clear
Silicon Valley Bank is no Lehman Brothers moment.
Of that we were assured by regulators, banking executives and any number of media pundits over the weekend, who took pains to draw SVB’s collapse as an outlier. But as the shock waves spread around the world Sunday, from Wall Street and here in London to Asia, it became horrifically clear that an entire new and important asset class would now need to be protected – climate tech.
Oliver O’Connell14 March 2023 01:45
What you need to know about the Silicon Valley Bank collapse
Two large banks that cater to the tech industry have collapsed after a bank run, government agencies are taking emergency measures to backstop the financial system, and President Joe Biden is reassuring Americans that the money they have in banks is safe.
It’s all eerily reminiscent of the financial meltdown that began with the bursting of the housing bubble 15 years ago. Yet the initial pace this time around seems even faster.
Over the last three days, the U.S. seized the two financial institutions after a bank run on Silicon Valley Bank, based in Santa Clara, California. It was the largest bank failure since Washington Mutual went under in 2008.
How did we get here? And will the steps the government unveiled over the weekend be enough?
Here are some questions and answers about what has happened and why it matters:
Silicon Valley Bank collapse: What you need to know
Two large banks that cater to the tech industry have collapsed after a bank run, government agencies are taking emergency measures to backstop the financial system, and President Joe Biden is reassuring Americans that the money they have in banks is safe
Oliver O’Connell14 March 2023 00:45
Over £50bn wiped off FTSE 100 amid banking stock sell-off
More than £50 billion has been wiped off the UK’s biggest stock market on Monday after the second and third biggest bank failures in US history spooked investors across the globe.
The collapse of tech-focused Silicon Valley Bank sparked fears across Wall Street that the banking system was being crippled by a relentless cycle of interest rate rises.
Oliver O’Connell13 March 2023 23:45
Premium: Silicon Valley rescue saves UK tech industry – but shares in other banks plummet
Britain’s tech industry was saved from a crisis on Monday after HSBC rescued the UK arm of Silicon Valley Bank in a deal brokered by the government and the Bank of England.
Oliver O’Connell13 March 2023 23:00
Start-ups, small businesses and online sellers despair at frozen funds
It’s not just large tech firms and venture capital funds caught up in the collapse of Silicon Valley Bank. There are numerous small businesses, kitchen table start-ups and side-hustle online retailers impacted by the sudden bank failure.
They range from business owners unable to pay employees to Etsy sellers worried about paying bills as online payments stalled.
Oliver O’Connell13 March 2023 22:15
Voices: The ghosts of the 2008 financial crisis loom over Biden’s response to Silicon Valley Bank
When President Joe Biden announced on Monday that people who had deposited their money in the now-unraveled Silicon Valley Bank would have their money available, he emphasised that American taxpayers would not be left on the hook.
Similarly, he added that the people responsible at the bank would need to be fired and that investors in Silicon Valley Bank would not be made whole, arguing that they took a risk and now have to suffer the losses.
On the surface, the Silicon Valley Bank collapse, as well as the closing of Signature Bank in New York, appears quite similar to the 2008 financial crisis that took banks like AIG to the brink and led to the collapse of Lehman Brothers. At the time, Mr Biden was a sitting senator running for vice president alongside Barack Obama. Both of them, as well as their White House opponent at the time, voted for the Troubled Assets Relief Program, or TARP, which became known as the “bailout” in the popular imagination.
But there are important distinctions between 2008 and today.
Oliver O’Connell13 March 2023 21:45
Shopify CEO: ‘Very minor impact for us’
Tobi Lutke, CEO of e-commerce platform Shopify, shared an email sent out to merchants offering to help if their funds were frozen at Silicon Valley Bank and confirmed that the collapse of the bank had only had “very minor impact for us”.
Oliver O’Connell13 March 2023 21:30
Watch: Ro Khanna says stock sale money should be ‘clawed back’ for depositors
Oliver O’Connell13 March 2023 21:16