Silicon Valley Bank depositors will have access to their money starting Monday, according to a joint statement by the Department of Treasury, Federal Reserve, and FDIC.
Before the major announcement, US Treasury Secretary Janet Yellen affirmed the government’s commitment to helping depositors affected by the sudden closure of SVB Financial. In response, bank regulators have devised a plan, and the Federal Reserve has announced a Bank Term Funding Program to help stave off fear and panic among those affected by the bank’s downfall.
US regulators plan to protect SVB depositors
The collapse of SVB Financial has been a major news story in the financial sector, causing worry amongst many as it marks the largest bank failure since 2008. In response, US Treasury Secretary Janet Yellen has affirmed the government’s commitment to helping those affected and announced that Silicon Valley Bank depositors would have access to their funds on Monday.
The Federal Reserve has launched the Bank Term Funding Program to safeguard deposits at the failed institution and allay fears of a potential bank run. This program will bolster the capacity of the banking system to protect deposits, thereby enabling it to continue providing money and credit services to support economic activity. The FED stated: “This action will bolster the capacity of the banking system to safeguard deposits and ensure the ongoing provision of money and credit to the economy.” Furthermore, they have reassured that they are prepared to address any liquidity pressures that may arise.
The Federal Reserve Board also announced that it would make additional funding available to eligible depository institutions to ensure they have sufficient resources to meet the needs of their depositors.