Yellen rules out federal bailout for Silicon Valley Bank

TSecretary of the Reasury Janet Yellen While denying a federal bailout of Silicon Valley Bank, the statement also highlighted that officials were trying to help depositors.

Silicon Valley Bank Friday: Collapsed Following a bank run, federal regulators took over the bank. SVB is often compared to other banks that were in trouble during the financial crisis. Financial crisis 2008Yellen however, claimed the circumstances are quite different.

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“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. “The reforms that have been put in place mean we are not going to do that again.”

Congress approved the Troubled Asset Relief Program, which is a bailout package of roughly $700billion. Yellen said that the Treasury Department is eager to assist depositors.

Bank deposits are covered up to $250,000. Many of SVB’s deposits exceeded $250,000. This was because it was the only bank that provided services to tech start-ups. Reports revealed that SVB’s CEO Greg Becker cuffed out stock options during the weeks leading to its collapse.