Following the collapse of Silicon Valley Bank, the Federal Deposit Insurance Corp (FDIC), the regulator that took control of the lender, has offered the bank's employees 45 days of employment at 1.5 times their salary, according to Reuters.
The email, titled "Employee Retention," informed staff that they would be enrolled and given information about benefits over the weekend, while healthcare details would be provided by SVB Financial Group, the bank's former parent company. Silicon Valley Bank had a workforce of 8,528 at the end of 2022.
In the email, employees were also instructed to continue working remotely, except for essential workers and branch employees. The FDIC has taken control of Silicon Valley Bank after depositors rushed to withdraw their deposits, concerned about the lender's health. The sudden two-day run on the bank blindsided observers and stunned markets, wiping out more than $100 billion in market value for U.S. banks.
Silicon Valley Bank was the 16th largest bank in the U.S. at the end of last year, with approximately $209 billion in assets and $175.4 billion in deposits. The FDIC has announced that the bank's main office in Santa Clara, California, and all of its 17 branches in California and Massachusetts will reopen on Monday.
The collapse of Silicon Valley Bank has raised concerns about the stability of the banking sector in the U.S. The FDIC's offer to retain the bank's employees for 45 days is aimed at ensuring the smooth transition of operations and mitigating the impact on staff. The move will also provide the regulator with the necessary time to evaluate the bank's operations and determine the best course of action to safeguard depositors' interests.
(With Agency inputs)