Silicon Valley Bank’s closure has raised concerns about uninsured depositors.
CNBC’s David Faber discussed the potential impact on businesses that rely on the bank for deposits and checking accounts, particularly those above the $250,000 insured mark.
The FDIC is working to find another bank to take on the uninsured deposits, which would provide relief for depositors.
However, it is uncertain how long it will take for them to receive their money, and there may be a market for buying those deposits at a discount.
The closure of Silicon Valley Bank could also affect innovative companies that are running out of cash, but it is unclear who will come to their rescue.
The losses from the bank’s portfolio of assets are expected to be borne by equity holders, while bondholders’ claims are trading at a significant discount to par.
