Silicon Valley Bank is shut down by regulators in biggest bank failure since global financial crisis
Financial regulators have closed Silicon Valley Bank and taken control of its deposits, the Federal Deposit Insurance Corp. announced Friday, in what is the largest U.S. bank failure since the global financial crisis more than a decade ago.
The collapse of SVB, a key player in the tech and venture capital community, leaves companies and wealthy individuals largely unsure of what will happen to their money.
According to press releases from regulators, the California Department of Financial Protection and Innovation closed SVB and named the FDIC as the receiver. The FDIC in turn has created the Deposit Insurance National Bank of Santa Clara, which now holds the insured deposits from SVB.
The FDIC said in the announcement that insured depositors will have access to their deposits no later than Monday morning. SVB’s branch offices will also reopen at that time, under the control of the regulator.
According to the press release, SVB’s official checks will continue to clear.
A Brinks armored truck sits parked in front of the shuttered Silicon Valley Bank (SVB) headquarters on March 10, 2023 in Santa Clara, California.
Justin Sullivan | Getty Images
The FDIC’s standard insurance covers up to $250,000 per depositor, per bank, for each account ownership category. The FDIC said uninsured depositors will get receivership certificates for their balances. The regulator said it will pay uninsured depositors an advanced dividend within the next week, with potential additional dividend payments as the regulator sells SVB’s assets.
Whether depositors with more than $250,000 ultimately get all their money back will be determined by the amount of money the regulator gets as it sells Silicon Valley assets or if another bank takes ownership of the remaining assets. There were concerns in the tech community that until that process unfolds, some companies may have issues making payroll.
As of the end of December, SVB had roughly $209 billion in total assets and $175.4 billion in total deposits, according to the press release. The FDIC said it was unclear what portion of those deposits were above the insurance limit.
The last U.S. bank failure of this size was Washington Mutual in 2008, which had $307 billion in assets.
Biggest bank failures since 2001
| Bank | Assets | Deposits |
|---|---|---|
| Washington Mutual | $307 billion | $188 billion |
| Silicon Valley Bank | $212 billion | $173 billion |
| IndyMac | $32 billion | $19 billion |
| Colonial Bank | $25 billion | $20 billion |
| Guaranty Bank | $13 billion | $12 billion |
Source: FDIC/FactSet
SVB was a major bank for venture-backed companies, which were already under pressure due to higher interest rates and a slowdown for initial public offerings that made it more difficult to raise additional cash.
The closure of SVB would impact not only the deposits, but also credit facilities and other forms of financing. The FDIC said loan customers of SVB should continue to make their payments as normal.
The move represents a rapid downfall for SVB. On Wednesday, the bank announced it was looking to raise more than $2 billion in additional capital after suffering a $1.8 billion loss on asset sales.
A notice hangs on the door of Silicon Valley Bank located in San Francisco, California, U.S. March 10, 2023.
Staff | Reuters
The shares of parent company SVB Financial Group fell 60% Thursday, and dropped another 60% in premarket trading Friday before being halted.
CNBC’s David Faber reported Friday morning that the efforts to raise capital had failed and that SVB had pivoted toward a potential sale. However, a rapid outflow of deposits was complicating the sale process.
While many Wall Street analysts have argued that the struggles for SVB are unlikely to spread to the broader banking system, shares of other midsized and regional banks were under pressure Friday.
Treasury Secretary Janet Yellen said during testimony before the House Ways and Means Committee on Friday morning that she was “monitoring very carefully” developments at a few banks. Yellen made her comments before the FDIC announcement.
Shortly after leaving Capitol Hill, Yellen convened a meeting of top officials at the Fed, the FDIC and the Comptroller of the Currency specifically to discuss the situation at SVB.
Nurphoto | Nurphoto | Getty Images
Meta is testing a long-awaited pause feature on Instagram Reels that will allow users to start and stop videos with just one tap.
The new feature is the latest sign that Meta is looking to capitalize on TikTok’s uncertain future in the U.S. after it briefly went dark earlier this month. The popular short-form video app, which is owned by the Chinese company ByteDance, could be banned for good on April 5 and is still unavailable on the Apple and Google app stores.
The pause feature is currently available to a small group of users around the globe, Meta said. The company was unable to specify when it will roll out more broadly.
Previously, Instagram users have only been able to pause videos on Instagram Reels by tapping and holding on their screen, requiring more work than simply tapping the screen to pause on TikTok. Previously, one tap on Instagram Reels would mute a video’s audio, but the video would continue to play. On Thursday, CNBC was able to pause Instagram Reels videos with a single tap.
Thousands of users have left comments and taken to other social media to lobby for a Reels pause button.
“Hello @instagram, can I please request a pause button on reels?? sincerely, a grieving former TikTok scroller,” one user posted on social media site X while TikTok was offline for a few hours in the U.S. earlier this month.
Besides the Reels pause button, Meta this month has announced a new video editing app called Edits that will compete directly with ByteDance’s CapCut editing app. Edits will launch in February, Instagram chief Adam Mosseri said in a post.
Meta is also paying creators to promote Instagram on TikTok, Snapchat, YouTube Shorts and other short-form video platforms, CNBC reported Sunday.
Shares of Meta are up slightly on Thursday, a day after the company reported fourth-quarter earnings that beat analysts’ estimates on the top and bottom lines.
“We’re going to learn what’s going to happen with TikTok, and regardless of that, I expect Reels on Instagram and Facebook to continue growing,” Meta CEO Mark Zuckerberg said on a call with analysts Wednesday.
Omar Marques | Lightrocket | Getty Images
Apple is struggling to squeeze growth out of its flagship iPhone unit, but its profit margin keeps going up thanks to a flourishing services business.
In its fiscal first-quarter earnings report on Thursday, Apple reported a gross margin — the profit left after accounting for the cost of goods sold — of 46.9%. That’s the highest on record, surpassing the 46.6% margin the company record in the period ending March 2024.
For Apple, services includes App Store purchases, advertising, payments, AppleCare support and other subscription offerings. The growth in those products has offset a slowdown in sales of the iPhone and a saturation in the global smartphone market.
The “services business in general in aggregate is accretive to the overall company margin,” Apple CFO Kevan Parekh said on the earnings call after the report.
In the current quarter, Apple said its gross margin will be between 46.5% and 47.5%.
IPhone sales slipped almost 1% in the latest quarter from a year earlier, as the company reported weakness in Greater China. Total revenue rose almost 4% to $124.3 billion.
Services revenue rose about 4% to $26.34 billion, beating analysts’ estimates. The business now accounts for roughly 21% of Apple’s overall revenue. Last quarter, Apple announced that its services unit had turned into a $100 billion a year business.
“We were thrilled to bring customers our best-ever lineup of products and services during the holiday season,” CEO Tim Cook said in the press release.
Cook’s emphasis on services has transformed Wall Street’s view of a company that’s been defined over the decades by its iconic devices. For many years in the iPhone era, Apple’s gross margin would predictably come in at between 38% and 39%, reflecting the company’s tight grip over its supply chain and its pricing power in the market.
But with iPhone growth slowing in recent years, Apple’s move into services has changed the equation. The company hit a 40% gross margin in 2021 and has continued to expand it.
Because of Wall Street’s love of profit, Apple’s been able to keep delivering for investors. The stock rose 31% last year, outperforming the Nasdaq, and the company’s market cap has climbed to $3.6 trillion.
“We believe Apple deserves to trade at premiums to its historical comparable valuation, as it sets itself further apart as a provider of premium electronic consumer devices and high-margined digital services, and notably as the age of on-device generative AI gets underway,” analysts at Argus wrote in a report earlier this month. They recommend buying the stock.
Apple shares rose more than 3% in extended trading after Thursday’s report.
WATCH: Apple’s AI integration going to be very important moving forward
OpenAI CEO Sam Altman speaks next to SoftBank CEO Masayoshi Son after U.S. President Donald Trump delivered remarks on AI infrastructure at the Roosevelt Room in the White House in Washington on Jan. 21, 2025.
Carlos Barria | Reuters
OpenAI is in talks to raise up to $40 billion in a funding round that would lift the artificial intelligence company’s valuation to as high as $340 billion, CNBC has confirmed.
Masayoshi Son’s SoftBank would lead the round, contributing between $15 billion and 25 billion, according to two people familiar with the negotiations who asked not to be named because the talks are ongoing. SoftBank would surpass Microsoft as OpenAI’s top backer.
The Wall Street Journal was first to report on the talks.
Part of the funding may be used for OpenAI’s commitment to Stargate, a joint venture between SoftBank, OpenAI and Oracle that was introduced by President Donald Trump last week, the sources said. The plan calls for billions of dollars to be invested in U.S. AI infrastructure.
OpenAI was last valued at $157 billion by private investors. In late 2022, the company launched its ChatGPT chatbot and kicked off the boom in generative AI. OpenAI closed its latest $6.6 billion round in October, gearing up to aggressively compete with Elon Musk’s xAI, as well as Microsoft, Google, Amazon and Anthropic.
Meanwhile, Chinese startup lab DeepSeek is blowing up in the U.S, presenting fresh competition to OpenAI. DeepSeek saw its app soar to the top of Apple’s App Store rankings this week and roiled U.S. markets on reports that its powerful model was trained at a fraction of the cost of U.S. competitors.
At an event in Washington, D.C., on Thursday hosted by OpenAI, CEO Sam Altman said DeepSeek is “clearly a great model.”
“This is a reminder of the level of competition and the need for democratic Al to win,” he said. He said it also points to the “level of interest in reasoning, the level of interest in open source.”
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