Mar 13, 2023 11:29:00

US Treasury Department and FRB announce full deposit protection of bankrupt 'Silicon Valley Bank' and 'Signature Bank'

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Silicon Valley Bank ', which went bankrupt on March 10, 2023, the United States Treasury Department , the Federal Reserve Board (FRB), and the Federal Deposit Insurance Corporation (FDIC) jointly launched a normal depositor protection It announced that it will take urgent safety measures, such as removing the cap on deposit insurance .

Joint Statement by the Department of the Treasury, Federal Reserve, and FDIC | US Department of the Treasury
https://home.treasury.gov/news/press-releases/jy1337

Federal Reserve Board - Federal Reserve Board announces it will make available additional funding to eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors

https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312a.htm

SVB, Signature Bank Depositors to Get All Their Money as Fed Moves to Stem Crisis - WSJ

https://www.wsj.com/articles/federal-reserve-rolls-out-emergency-measures-to-prevent-banking-crisis-ba4d7f98

Regulators Announce Plan To Ensure SVB Depositors
https://news.crunchbase.com/venture/silicon-valley-bank-treasury-depositors/

On March 10, 2022, Silicon Valley Bank, a major U.S. bank, went bankrupt on March 10, 2022, following Silvergate Bank, whose main business was trading with virtual currency companies, which closed its business on March 8, 2023. The U.S. Department of the Treasury, the Federal Reserve Board, and the FDIC jointly determined that the bank's bankruptcy was a systemic risk , and decided to protect depositors by implementing new financial safeguards to strengthen confidence in the banking system. Announced.

The maximum deposit insurance covered by the FDIC is stipulated to be a maximum of $250,000 (approximately 33.6 million yen) per account. You can withdraw your deposits after March 13, 2023, including the deposits that will be. Regarding this measure, Secretary of the Treasury Janet Yellen said, ``Customers will not bear the losses associated with the bankruptcy of Silicon Valley Bank.'' Silicon Valley Bank shareholders and some unsecured creditors have been announced as exempt from this protection.

According to the Fed, these funds will be available through the Bank Term Funding Program (BTFP) jointly created by the Treasury Department, Fed and FDIC. BTFP is a fund that provides loans of up to one year to banks, savings associations and credit unions that provide high-quality collateral such as US Treasuries and mortgage-backed securities.

In addition, it was revealed that BTFP has up to $25 billion in additional funding from the Currency Stabilization Fund . However, the Fed stressed, 'We do not anticipate that there will be situations where these funds will be used.' In addition, Secretary of the Treasury Yellen added, 'We will never do anything like this again. However, we make depositor protection our number one priority and we are very vigilant about meeting the needs of our depositors. I am.”

However, on March 12, 2023, it was announced that the business of “Signature Bank”, which had been trading with virtual currency-related companies, would be suspended . Along with this, the Ministry of Finance, the FRB, and the FDIC have announced that they will invoke ``systemic risk exemptions similar to those of Silicon Valley banks,'' and signature bank depositors will be able to withdraw their own deposits without an upper limit. is clarified.