A Brinks armored truck parks in front of the closed Silicon Valley Bank (SVB) headquarters in Santa Clara, California, March 10, 2023.
Justin Sullivan | Getty Images
The technology company’s founders and executives were unfazed by Friday’s inclement weather and crowded the doors. Silicon Valley Bank Locations throughout the Bay Area in hopes of getting money and answers to important questions.
Regulators shut down SVB, seizing deposits in the second-largest US bank failure in history and the largest since the 2008 financial crisis.
Thousands of start-ups have long looked to SVB for their everyday banking services. The company’s sudden bankruptcy raised pressing concerns about how clients would pay their bills and employees.
Some company leaders went to bank branches to ask for help. While waiting in long lines outside, they struck up friendships with those on board the same boat and shared their tragic stories.
“Hopefully better news on Monday”
SVB has 17 branches in California and Massachusetts, among which the FDIC states: press release “Silicon Valley Bank’s headquarters and all branches will reopen on Monday, March 13, 2023.”
Regulators said all uninsured deposits will be accessible on Monday. However, the FDIC only guarantees deposits of up to $250,000 per customer, and as a bank that primarily serves businesses, about 95% of SVB’s deposits are uninsured.
On Friday morning in Santa Clara, SVB customers arrived frustrated and angry.
A group of four men gathered near the door. Some had tears in their eyes.
One of the men, who requested anonymity, told CNBC that he had been banking with SVB since 2018 and did not expect this to happen. He said most of his money is tied up in banks. Eventually the man sobbed as he apologized for his excuses.
woman was dropped uber, backpack over his shoulders, marched to the front door of the bank, past the crowd, determined to speak to someone. When she reached the locked door, people in the crowd muttered about how no one spoke to them. It didn’t work so the lady ordered another Uber of hers and picked me up a few minutes later.
Towards the end of the day, startup founders trickled into the promenade of their Menlo Park offices in hopes of catching a representative.
Jennifer Elias
A customer was heard repeating the phrase, “I hope for good news on Monday.”
Signs in the windows of each store repeated a line of press releases announcing that all stores would reopen on Monday.
An employee at the startup, who wished to remain anonymous, covered the 2008 financial crisis and the FDIC’s acquisition of Washington Mutual.Failed savings and loans sold JP Morgan Chaseand the man said he hoped similar results for SVB.
At one point, a pizza delivery man showed up with at least five boxes of pizza. It was the first time the door had been open for hours.
“I’m about to get my check!”
In Menlo Park, the Tesla parked in the SVB’s Sand Hill Road parking lot on Friday. The customer got out of the car and approached the entrance.
People who visited the San Francisco branch earlier in the day received sticky notes directing corporate customers to the bank’s Sandhill location. It was a 40 mile drive he did not get a satisfactory answer.
“I’m trying to get a check!” said one man, knocking on the locked glass door while making eye contact with someone working in the office. Representatives came out regularly, answered client questions in a whisper, and refused to speak to the press.
SVB clients knocked on the locked front door of the Menlo Park office, hoping to get the attention of security and personnel.
Jennifer Elias
One startup founder told CNBC that he came to ensure that tens of thousands of dollars in international wire transfers were processed.
“I don’t know if they will cancel the wire transfer, but they didn’t say anything about it and when we called, we weren’t getting through,” the man said anonymously. “So we were just kind of scrambling and thought we’d just come here because it’s not that far away.”
He said once the check cleared, “I’ll probably look into other financial institutions and deposit the money.”
The startup’s two founders were waiting for a representative to respond to their knock.
“After this, we’re putting money in multiple banks,” one said to the other. “If we are still here”
The men declined to give their names, telling CNBC only that they were the founders of separate small startups.
Another startup exec told a rep that he traded at 8:30 a.m. A bank employee said he missed the 8:15 deadline to process the transaction. The devastated man bowed and said, “I understand your stress. This is our only bank.”
“Okay,” said the representative.
Another client who found a representative approached her and “tried to call that number, but it didn’t go through,” referring to the customer service line listed in the company’s press release. The bank employee apologized and immediately closed the door.
Some people came just for pictures and selfies. Menlo At her Park store, one of hers in a Patagonia jacket posed for a photo in front of her SVB logo. When asked if he was a customer, he laughed and said, “I used to be.”
— CNBC’s Rebecca Smith contributed to this report.
clock: Economic impact of SVB
