(Replying to PARENT post)
Edit - this has been the first fdic takeover since 2020, so no, it does not happen often.
This chart of historic bank failures paints a different picture:
๐คmywittyname๐2y๐ผ0๐จ๏ธ0
(Replying to PARENT post)
> And any accounts over $250K, poof.
That's not quite true; the FDIC will pay uninsured depositors an advance dividend within the next week.
๐คborski๐2y๐ผ0๐จ๏ธ0
(Replying to PARENT post)
Re Bear Sterns, there were lots of political reasons it was allowed to fail while others were protected. If I remember right something about them not helping with the Long Term Capital Management collapse for example. There will have been people who had the opportunity to help SVB and collectively decided it was better to let it fail. It will be interesting to understand the decisions that were made when the dust settles
๐คversion_five๐2y๐ผ0๐จ๏ธ0
(Replying to PARENT post)
I mean, potentially.
The reality is they try to protect as much of the assets as they can and even those over 250k will probably not lose as much as they would have without the FDIC
๐คPasorrijer๐2y๐ผ0๐จ๏ธ0
(Replying to PARENT post)
Itโs not interesting because of its name, itโs the 18th largest bank in the US. A domino that big usually doesnโt fall alone. Also, FDIC hasnโt taken over a bank since 2020. This isnโt exactly a common occurrence.
๐คyeahsure22๐2y๐ผ0๐จ๏ธ0
(Replying to PARENT post)
The fed's move in interests rates was bound to break something. This is the first big name and, while banks are taken over by the FDIC often and it never makes the news, this one will be especially interesting bc it is Silicon Valley Bank. Naturally, people and the media will associate with the rest of silicon valley, bringing extra scrutiny to every brand name tech company, especially the ones that are still barely profitable.
And any accounts over $250K, poof.
Edit - this has been the first fdic takeover since 2020, so no, it does not happen often.