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The bank operates multiple locations in Massachusetts.
NEW YORK (AP) — The U.S. government took emergency steps Sunday in an attempt to prevent more instability among banks after the historic failure of Silicon Valley Bank, and assured clients of the failed financial institution that they would be able to recover all of their money quickly.
The announcement came amid fears that the factors that caused the Santa Clara, California-based bank could spread, and only hours before trading began in Asia. Regulators had worked all weekend to try and come up with a buyer for the bank or broker another intervention, and as another bank, Signature Bank, was shuttered. The Treasury Department, Federal Reserve and FDIC said Sunday that all Silicon Valley Bank clients will be protected and have access to their funds and announced steps designed to protect the bank’s customers and prevent more bank runs.
Silicon Valley Bank’s website lists Massachusetts branch locations in Boston and Newton, as well as former Boston Private locations in Boston, Beverly, Cambridge, and Wellesley. SVB bought Boston Private in June 2021.
Massachusetts Governor Maura Healey said in a statement released Sunday that her office “is actively working to support individuals and businesses affected by SVB’s closure and to find solutions to help them address immediate needs, including putting supports in place to ensure that small businesses and employees do not experience significant disruptions.”
Massachusetts Economic Development Secretary Yvonne Hao also released a statement, noting that the state “may be uniquely impacted by this situation due to our strong technology, innovation, and life sciences sectors and because SVB had a broad client base here, including nonprofits, individuals and others.”
In a tweet posted Saturday, Boston Mayor Michelle Wu assured those affected by the Silicon Valley situation that her office is monitoring developments, and invited people to share their information and experiences.
“This step will ensure that the U.S. banking system continues to perform its vital roles of protecting deposits and providing access to credit to households and businesses in a manner that promotes strong and sustainable economic growth,” the agencies said in a joint statement.
Regulators had to rush to close Silicon Valley Bank, a financial institution with more than $200 billion in assets, on Friday when it experienced a traditional run on the bank where depositors rushed to withdraw their funds all at once. It is the second-largest bank failure in U.S. history, behind only the 2008 failure of Washington Mutual.
Some prominent Silicon Valley executives feared that if Washington didn’t rescue the failed bank, customers would make runs on other financial institutions in the coming days. Stock prices plunged over the last few days at other banks that cater to technology companies, including First Republic Bank and PacWest Bank.
Among the bank’s customers are a range of companies from California’s wine industry, where many wineries rely on Silicon Valley Bank for loans, and technology startups devoted to combating climate change.
Sunrun, which sells and leases solar energy systems, had less than $80 million of cash deposits with Silicon Valley Bank as of Friday and expects to have more information on expected recovery in the coming week, the company said in a statement.
Stitchfix, the popular clothing retail website, disclosed in a recent quarterly report that it had a credit line of up to $100 million with Silicon Valley Bank and other lenders.
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