Silicon Valley Bridge Bank’s new CEO, Tim Mayopoulos, has one demand: that depositors return to the lender.
“The first thing you can do to support the future of this institution is to help us rebuild our deposit base, both by leaving deposits at Silicon Valley Bridge Bank and by transferring remaining deposits over the past days,” he wrote in an email to clients on Tuesday.
The bank is open for business, making new loans and honoring existing credit facilities, Mayopoulos said. Amid a classic bank run, withdrawals initiated by depositors and investors totaled $42 billion on March 9 alone, regulators said. The bank was seized by regulators on March 10. Mayopoulos, who helped inaugurate Fannie Mae through the global financial crisis, was appointed CEO of the bridge bank on Monday.
“If you, your portfolio companies, or your business have moved funds in the past week, please consider moving some as part of a safe deposit diversification strategy,” he wrote. . “We are also open for business for any new clients.”
Mayopoulos said in a conference call with clients on Tuesday that the future of the bank “is still being worked out” and that the company could be recapitalized, taken over by a new owner or dissolved. He called the latter “the least desirable outcome”.
A group of top venture capitalists said they would continue to do business with the bank. In a statement shared by General Catalyst CEO Hemant Taneja, the group said it recommends portfolio companies keep 50% of their total capital with SVB.
“We believe SVB is now one of the safest and most secure banks in the country,” the group said.
Mayopoulos echoed that sentiment during a client call, the contents of which were reviewed by Bloomberg. The Federal Deposit Insurance Corp. eliminated “any cap on deposit insurance coverage at our institution, so now all despots here at Silicon Valley Bridge Bank are guaranteed” without limits, he said. “It really is the safest place in the United States to deposit your funds in a bank.”
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