On Friday (10), the US authorities announced that they had shut down the activities of Silicon Valley Bank (SVB), a bank working to support the technology sector. It was created in 1983 and will provide credit to many startups.
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According to the “New York Times”, the bank presented itself as a “partner in the innovation economy”, but began to make decisions considered “old-fashioned”.
On Thursday (9), the bank’s CEO, Greg Baker, told customers to stay calm. However, many investors didn’t trust Baker’s request, and shares plunged 60%, causing SVB to lose nearly $10 billion, according to Bloomberg.
Valley Bank is the first institution to fail this year insured by Federal Deposit Insurance Corp (FDIC), the US government’s regulator. Almena State Bank in Kansas was the last FDIC-insured institution to close on October 23, 2020.
The Silicon Valley bank’s head office and all branches will reopen on March 13, the FDIC said, and all insured depositors will have full access to their deposits.
Wall Street indexes fell on Friday, as investors nervous about the health of US banks.
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