(Atlantic) Friday’s collapse of the Silicon Valley Bank, the nation’s 16th largest bank with around $209 billion in assets at the end of 2022, got the nation’s attention when the FDIC seized the banks’ assets. This is marked as the second-largest bank failure since the 2008 financial crisis.
Glen Smith, of Atlantic, and member of the Farm Credit Administration, the financial regulatory agency of the farm credit system in Washington D.C., says this was precipitated by an old-fashioned run-on back depositors wanting to pull their money out of the bank that did not have the liquidity to handle it.
On Monday, President Biden stated, “the banking system is safe.”
Smith says the message here is this was a unique, almost single-industry bank without many diversifications and entirely focused on startup companies.
Smith says the FDIC guarantees deposits up to $250,000; those depositors are covered.
During the Trump Administration, Smith was appointed CEO and Chairman of the Board of the Farm Credit Administration Regulatory Agency, which he served for three and a half years. His term ended in May 2022, but he remains on the three-member Board of Directors in a “holdover status.”
