The US banking sector looks like a house on fire, as First Republic Bank's stocks have also plunged by 60 per cent after Silicon Valley Bank and Signature Bank collapsed within days. With chaos spreading in the US market and pushing down global stocks, the Indian minister of state for IT will also meet startup founders. Amidst concerns, the Federal Deposit Insurance Corporation, which insures up to $250,000 for account holders, has set up a Deposit Insurance National Bank of Santa Clara.
Supporting insured and uninsured clients alike
All insured deposits from the Silicon Valley Bank have been transferred to the DINB, as soon as the lender was shut down by regulators. Apart from insured depositors, uninsured customers will also get their advance dividend in a week. Further payments for uninsured account holders will also be released as Silicon Valley Bank's assets are sold off by the FDIC.
Reassuring account holders
FDIC will also have control of all SVB assets, while online banking operations and clearing of official checks will resume this week. People with deposits of more than $250,000 have been asked to contact the insurer. About 60 startups from India backed by YCombinator, also have their funds parked in SVB, and may struggle to pay salaries or survive at all.
The stock sell off for First Republic Bank also picked up pace, despite assurances about its liquidity from regulators in the US.
