Janet Yellen: No federal bailout for Silicon Valley Bank

by WorldTribune Staff / 247 Real News March 12, 2023

The collapse of Silicon Valley Bank appears to have been fueled in part by inflation and higher interest rates from the Federal Reserve.

While analysts say Team Biden contributed to SVB’s downfall, it apparently will not come to its rescue.

Treasury Secretary Janet Yellen appeared to rule out a federal bailout for SVB.

At the same time, Yellen said, government officials are scrambling to assist depositors.

Silicon Valley Bank collapsed Friday following a run on the bank, prompting a takeover by federal regulators.

“Let me be clear that during the financial crisis, there were investors and owners of systemic large banks that were bailed out,” Yellen told CBS News. “The reforms that have been put in place mean we are not going to do that again.”

Under the Federal Deposit Insurance Corporation policy, bank deposits are insured up to $250,000. Since SVB was a unique bank that serviced tech start-ups, many of the bank’s deposits were over $250,000. Since SVB’s collapse, reports revealed that its CEO Greg Becker cashed out stock options in the weeks leading up to its collapse.

“We are concerned about depositors and are focused on trying to meet their needs,” Yellen said. “I’ve been working all weekend with our banking regulators to design appropriate policies to address this situation.”

Depositors protected by the FDIC are expected to gain access to insured deposits by Monday.

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