Friday, 10 March 2023

Some SVB customers are struggling to wire funds out of the bank

by Berkeley Lovelace

Some of Silicon Valley Bank’s customers are struggling to transfer funds out of their bank accounts, numerous sources tell TechCrunch.

The seeming wave of attempted withdrawals comes after SVB announced yesterday that it lost $1.8 billion in the sale of U.S. treasuries and mortgage-backed securities that it had invested in, owing to rising interest rates. The bank also said that it was raising more capital, and investing into higher-yield products. Concern ensued, leading the share price to tank more than 50% at time of publication.

Dozens of VCs are advising their portfolio companies to pull their assets from the bank, sources say, while others are pushing for founders to at least diversify where they hold their capital. Others, meanwhile, warn that the panic is coming too early — perhaps from earlier news this week that Silvergate, another bank, is shutting down. SVB as a result is clearly experiencing deposit volatility from a subset of its users.

One source tells TechCrunch that parts of the SVB site is down, as well as one of its client support phones, despite using different browsers and apps to try to move their capital. Another says that account access controls are now view only, meaning that users cannot conduct withdrawals or wires. Others on Twitter say that they’re unable to log into the online banking portal at large.

One VC tells me that, because the website is down, portfolio founders are at SVB bank branches currently asking for cash to be released.

In a call earlier today, CEO Greg Becker told clients that said the bank has “ample liquidity” to support its clients “with one exception: If everybody is telling each other that SVB is in trouble, that will be a challenge.” The executive asked VC clients to “stay calm. That’s my ask. We’ve been there for 40 years, supporting you, supporting the portfolio companies, supporting venture capitalists.”

If you have a juicy tip or lead about happenings in the venture world, you can reach Natasha Mascarenhas on Twitter @nmasc_ or on Signal at +1 925 271 0912. Anonymity requests will be respected. 

Some SVB customers are struggling to wire funds out of the bank by Natasha Mascarenhas originally published on TechCrunch