Here's what to know about Silicon Valley Bank and bank runs:
, because not all of the money is actually in the bank in the first place.
What begins mostly as fear of bank insolvency becomes real insolvency, because no one wants to be last in line to get their cash.to address the waves of bank runs in the U.S. following the 1929 stock market crash. The goal was to make banks more stable and ease fears of being able to access one's account.
It's an independent federal agency that insures banks' deposits up to $250,000 per depositor, which means that if your FDIC-insured bank fails, you can safely access up to a quarter million dollars of your money there. The FDIC also acts as the receiver of the failed bank, effectively taking control of the bank, as happened with SVB Friday morning. It has assured depositors they will have full access to their funds.of SVB's $161 billion in deposits were not insured. What happens to that money is not yet clear.
The best-case scenario is that another financial institution agrees to buy SVB soon, which would likely facilitate the reopening of client accounts and calm investors, Axios' Dan Primack
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