Some of Silicon Valley Bank’s customers are having trouble transferring money out of their bank accounts, multiple sources told TechCrunch.
Rising interest rates have seen a wave of withdrawal attempts after the SVB announced yesterday that it lost $1.8 billion on the sale of Treasuries and mortgage-backed securities it had invested in. The bank also said it was raising more capital and investing in higher-yielding products. Concerns mounted, and the stock fell more than 50% at the time of the announcement.
Sources say dozens of VCs are advising investee companies to get their assets out of banks, while others are asking founders to at least diversify where they hold their capital. On the other hand, this week’s news of the closure of another bank, Silvergate, warns that panic is coming too soon. As a result, SVB is clearly experiencing deposit volatility from a subset of its users.
A source told TechCrunch that parts of the SVB site and one of its client support phones are down, despite trying to use different browsers and apps to transfer funds. , which states that account access control is currently view-only and users cannot make withdrawals or wire transfers. Other users on Twitter say they can’t log into the entire online banking portal. One VC said the founder of the portfolio is now at a branch of SVB Bank asking for the release of cash as the website is down.
TechCrunch spoke to the founder, who requested anonymity, but said a call to a local representative ultimately led to SVB customer support. Representatives told them the website was spotty due to the high volume of traffic from users.The founder eventually banked millions of dollars that he wire transferred to First Republic Bank. Did. The transaction is expected to take place tomorrow morning.
“We will probably put some, if not all, back when the chaos dies down,” the founder said, adding that he didn’t want to be part of the bank run. Yet they say, “The game theory here is that you might lose the company if you don’t. If you do, it’s not that big of a deal.” We talked about legal obligations.
Another founder told TechCrunch that they’re banked with SVB and “are taking a less guarded approach, despite receiving several emails from investors. We’re diversifying where we hold our cash (we’re a credit card company, so we’ve moved some to our sponsor bank) and I’m pretty sure SVB isn’t going anywhere.”
CEO Greg Becker told clients in a call today that banks have “adequate liquidity” to support them. That’s my question: For 40 years, we’ve been supporting our clients, supporting our portfolio companies, and supporting venture capitalists.”
If you have any useful tips or clues about what’s going on in the venture world, you can reach out to Natasha Mascarenhas on Twitter @nmasc_ or Signal (+1 925 271 0912). Anonymous requests will be honored.
