IN PICS | People Line Up Outside Silicon Valley Bank Branches In US Cites Amid Crisis

Dozens of people lined up outside SVB’s Santa Clara branch on Monday hoping to access their accounts, reported a local news portal San José Spotlight.

A customer, Karthik Ramalingam, waiting outside the bank told the news portal, “The past few days, it has been a little stressful…We’re just hoping to get through the line and get our money...We’ve been shopping around with other banks today to open up accounts. I think it’s a good lesson for us to know to diversify.”

Silicon Valley Bank was regarded as a major US lender for venture capital-backed firms, specifically for tech start-ups. The closing of SVB is seen as major bank failure since Washington Mutual during the height of the 2008 financial crisis.

The bank has been severely hit in the past 18 months because of persistent rate hikes by the US Fed and decreasing investor demand for risky digital assets.

President Joe Biden on Monday said, Americans can have confidence that the banking system is safe…Your deposits will be there when you need them…Small businesses across the country that deposit accounts at these banks can breathe easier knowing they'll be able to pay their workers and pay their bills. Biden added that no losses associated with the resolution of Silicon Valley Bank will be borne by the taxpayer.

San José Spotlight reported that security guards were seen escorting government officials and customers in and out of the building one at a time. Last Sunday, the Federal Reserve Board said it would protect all depositors of Silicon Valley Bank and New York-based Signature Bank.

A venture capitalist outside the bank told the news portal that several of his portfolio businesses, which are banked at Silicon Valley Bank, as are his personal funds.

The SVB collapse routed $465 billion in market value so far, Reuters reported.