Silicon Valley Bank collapse: U.S. officials reportedly weigh backstopping depositors

TAccording to reports, financial officers at OP are looking into the possibility for backstopping Silicon Valley Bank Depositors in the race to find a buyer

There are two options: regulators can tap into the powers of the Federal Deposit Insurance Act SVB to protect your deposits uninsured or to set up a “general banking facility” From the Federal Reserve Assist other financial institutions with direct exposure to SVB. According Multiple reports.

SILICON VALLEY BANK DEPOSITORS MAY GET SOME OF THEIR UNINSURED MONEY BACK MONDAY: REPORT

Officials are mulling over their options in hopes of averting contagion — a phenomenon in finance where turbulence from one institution ripples across the industry, causing runs on banks nationally. FDIC policy covers deposits up to $250,000, but SVB has deposits that are much larger.

According to reports, the FDIC began an auction for SVB bidders Saturday. This was in anticipation of the political apprehensions and fears of moral hazards that would accompany a fully-fledged government-funded rescue. Janet Yellen, Treasury Secretary ruled out SVB Sunday received federal bailout

In the unlikely event that no buyer emerges, the FDIC, Treasury Department and Fed will continue to explore their options.

Representatives from both political parties in Congress stressed the need for a solution to depositors whose funds weren’t insured. The lawmakers who have spoken