Silicon Valley Bank shutdown rattles Bay Area start-up owners, tech industry

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The bank failed after depositors -- mostly technology workers and venture capital-backed companies -- began withdrawing their money, creating a run on the bank.

In San Francisco on Friday, some people were distraught about the closure of Silicon Valley Bank and were hoping to withdraw money from their accounts. Others were confused, saying they wondered how this shutdown could happen so suddenly.

The bank had $209 billion in assets and $175.4 billion in deposits at the time of failure, the FDIC said in a statement. It was unclear how much of the deposits was above the $250,000 insurance limit at the moment. Silicon Valley bank was not a small bank, it's the 16th largest bank in the country, holding $210 billion in assets. It acts as a major financial conduit for venture capital-backed companies, which have been hit hard in the past 18 months as the Federal Reserve has raised interest rates and made riskier tech assets less attractive to investors.

Only members of the FDIC were on-site Friday. They explained to customers that the bank will reopen on Monday, at which point customers can get back their money up to $250,000, the insured amount by the FDIC. Customers with more in SVB will receive a receivership certificate for the remaining amount of their uninsured funds.

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Silicon Valley Bank shutdown rattles Bay Area start-up owners, tech industryThe bank failed after depositors -- mostly technology workers and venture capital-backed companies -- began withdrawing their money, creating a run on the bank.
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