During the week of March 10, 2023, the California Department of Financial Protection and Innovation and the New York State Department of Financial Services shut down Silicon Valley Bank (SVB) and Signature Bank (Signature), respectively, and appointed the Federal Deposit Insurance Corporation (FDIC) as receiver for each bank. In response, the U.S. Department of the Treasury, Board of Governors of the Federal Reserve System (FRB), and the Federal Deposit Insurance Corporation (FDIC, and collectively, the Agencies), announced that all depositors of both banks would have access to the full amount of their deposits – insured and uninsured – beginning Monday, March 13. The FDIC, as receiver for the banks, has established bridge institutions through which such deposits will be made available. The FRB also announced that it is establishing a new Bank Term Funding Program (BTFP) meant to provide liquidity to certain types of institutions.
These closures and announcements have had a broad impact on the financial markets, investors, companies, and employees, globally. Sidley lawyers across multiple practices are following developments on these issues closely and are actively advising clients on the potential effects on their businesses.
