Bankruptcy of SVB bank: Washington rules out bailout with public funds
US Treasury Secretary does not want to repeat the scenario interventionist of the 2008 financial crisis.
The CVB bank was no longer able to cope with massive withdrawals from its customers, mainly technology players.
The government American wants to avoid that the bankruptcy of the American bank Silicon Valley Bank (SVB) does not cause a contagion to the rest of the banking system, indicated Sunday the American Secretary of the Treasury, Janet Yellen, who nevertheless ruled out a bailout of the establishment .
We want to make sure that issues affecting one bank don't infect others that are strong, the US Treasury Secretary said in an interview with CBS.
< p class="e-p">The Deposit Guarantee Agency (FDIC), an offshoot of the US government, took control of Silicon Valley Bank on Friday, on the verge of implosion under the effect of massive withdrawals from its customers.
If the big banks have so far been spared, several medium-sized or regional establishments unscrewed on the stock market on Friday, fled by worried investors.
This is the case in particular of the Californian First Republic, which dropped nearly 30% in two sessions, Thursday and Friday, or of Signature Bank, amputated by a third of its value since Wednesday evening.
Both institutions have a large proportion of corporate clients in their portfolio, whose deposits often exceed the FDIC's maximum insured amount of US$250,000 per depositor, which could lead them to withdraw their funds. /p>
US Treasury Secretary Janet Yellen (File photo)
Janet Yellen explained Sunday that the government was working this weekend, with the FDIC, to resolve the situation of SVB, approximately 96% of whose deposits are not covered by the FDIC money-back guarantee.
I'm sure [the FDIC] is considering a wide range of options, including an acquisition by another bank, the Treasury Secretary said.
The Democratic Senator from Virginia, Mark Warner, estimated on Sunday on the ABC channel that the announcement that same day of a takeover of SVB by a financial institution before the opening of the Asian markets would be the best solution. .
Futures on the flagship indexes of the Tokyo and Hong Kong stock exchanges pointed to an opening down just under 2%.
Janet Yellen, on the other hand, ruled out a rescue of SVB via an injection of public money.
During the financial crisis [of 2008], investors in large systemic banks, whose collapse authorities believe would pose a risk to the entire financial system, were rescued by the US government, she recalled. .
“We're not going to do it again.
— Janet Yellen, U.S. Secretary of the Treasury
In September 2008, to avoid a collapse of the financial system, the American authorities had thus injected hundreds of billions of dollars into most of the major institutions in difficulty, funds that the government then recovered.
Several figures in finance and the world of new technologies have pleaded since Friday for a bailout of SVB. Because, in addition to the stability of the banking system, many say they are concerned about the repercussions of the bankruptcy of SVB on the American technology sector, but also beyond.
SVB prided itself on having almost half of the technology and life sciences companies financed by American investors as clients.
Many depositors are small businesses that need access to their funds to pay their bills and they employ tens of thousands of people in the United States, Yellen noted. .
This is a problem and we are working with regulators to find a solution, she continued.
On Sunday, UK Finance Minister Jeremy Hunt said the fall of SVB posed a serious risk to Britain's tech sector.
Several entrepreneurs have also warned, in recent hours, of a possible shock wave for emerging Indian technology companies, several of which were SVB customers.
The turmoil of the SVB saga has also spread in the middle of cryptocurrencies. The digital currency USDC (Tether), said to be stable because theoretically indexed to the dollar, has thus fallen since Friday after its creator, Circle, announced that it had left 3.3 billion dollars in the coffers of SVB.
Several other stablecoins (which are used to buy and sell cryptocurrencies), supposed to protect cryptocurrency investors against the legendary volatility of this industry, have also stalled, such as the Dai or the x27;USDD.