I say let SVB fail &stick to the $250k cap..Sickens me that these bank execs take huge risks & suffer none of the consequences. And love that they paid bonuses out just hours before the collapse. Gov't should clawback all that & all the bonuses & compensation from those in charge for the past 5 years at least. Only way they're gonna learn is if you hit them in their pockets instead of us little guys.

So much for the $250,000 FDIC insurance. Everyone gets their money back.

We live in a world where profit is shared by the few (in private) and risks are shared by the many (in public). Another example of "disbursed costs (many taking on the risk) and concentrated benefit (while few take in the profit)".

Perfectly stated. (Groan.)

@Old_Joe - I’m aware of the $250,000 automatic coverage and cap on FDIC insured deposits. My underlying point was that if the coverage of amounts beyond $250,000 were automatic than there would no longer be any need to distinguish between the $250,000 FDIC insured amount and greater amounts because if it’s automatic everyone’s covered anyway. In the end it’s all one when viewed that way. (ie - when the #*&# hits the fan the government will step in and cover everyone.)

So much for the $250,000 FDIC insurance. Everyone gets their money back.

We live in a world where profit is shared by the few (in private) and risks are shared by the many (in public). Another example of "disbursed costs (many taking on the risk) and concentrated benefit (while few take in the profit)".

"So it’s not automatic. If it were automatic there’d be no need for FDIC insurance."
@hank: For bank account amounts of 250k or less FDIC insurance is "automatic".
The problem is with accounts in excess of 250k: there is no government mechanism for protecting those accounts. There should be, and those depositors should pay a reasonable amount for that insurance. If a depositor chooses not to participate, they're on their own. If a bank gets into trouble, they're on their own.
Simple as that.

Thanks @Old_Joe From the write: 'Fed officials declined to provide a specific figure for the size of that new loan program, but made clear it would be large enough to cover trillions of dollars in potential requests.' Really, trillions ???
So, a full bailout did take place and has set a precedent regarding the $250K insured account ceiling. I suppose one could go to court with this, eh?; if one didn't get a full $500k at some future date.

Before Market open at 9:30 EDT on Monday, 13 March, 2023. Here is an extremely random list of how some banks fared at the Closing Bell, this past Friday: (And we shall see just what happens on Monday!)
CCBG. Tallahassee: +0.12%
BHB. Bar Harbor, Maine: -1.78%
OCFC, N.J. -3.64%. (The Big Loser on THIS list.)
CAC. Camden, Maine: -1.47% and a 52-week new low.
CATC. Cambridge, MA. -2.02%
SSB. Winter Haven: new 52 week low, but CNBC.com reports a bounce-back: +1.26%
SMMF Eastern WV panhandle, Shenandoah Valley in VA. Also just took over and merged with Prov. State Bank in the Eastern Shore of MD: -1.46%.
UNB. Morrisville, VT: -3.42%
BMO (owns the old Harris Bank out of Chicago in the USA:) -2.64%
CM (owns PrivateBancorp in the USA:) -1.9%.

March 12 (Reuters) - State regulators closed New York-based Signature Bank (SBNY.O) on Sunday, the third largest failure in U.S. banking history, two days after authorities shuttered Silicon Valley Bank (SIVB.O) in a collapse that stranded billions in deposits.
The Federal Deposit Insurance Corporation (FDIC) took control of Signature, which had $110.36 billion in assets and $88.59 in deposits at the end of last year, according to New York state's Department of Financial Services.
All of the depositors of Signature Bank and Silicon Valley Bank will be made whole, and "no losses will be borne by the taxpayer," the U.S. Treasury Department and other bank regulators said in a joint statement.

Well here's what I'm seeing: It's just a fact that in today's financial arena there are certain types of businesses that have a need to maintain very large amounts of cash which is readily available for deployment on short notice.
As far as I can see, the financial system, generally speaking, does not really have any mechanism to provide this "safe haven".
Now if the Fed, FDIC, or some appropriate government agency were to provide a "safe-deposit" facility for deposits over 250k, and charge a reasonable fee for providing that service, then depositors who did not use such a facility would have no recourse other than to blame themselves if they did not use such a service.
How could that be done? Well what if the FDIC or some other responsible government agency were set up to accept these large deposits, and then redistribute that cash in small deposit amounts to all of the banks in the FDIC system? This would certainly provide safety for that money, as for sure not all of the banks in the FDIC system are likely to get in trouble all at the same time.
I just think that businesses needing a safe haven for large amounts of cash should be able to have a simple and safe solution. They should be able to concentrate on running their primary business, and not be required to to operate an in-house financial group just to keep track of their deposits.
@msf, @yogibearbull- I would appreciate your comments on this.

So much for the $250,000 FDIC insurance. Everyone gets their money back.

Yes, it is heinous.

Although it could be inside information, more likely the previous decline before the SVB news had to do with rate hikes and Wells Fargo layoffs:
https://seekingalpha.com/news/3945059-why-did-wells-fargo-stock-drop-today-fed-chairs-comments-hit-bank-stocks-hard

Bank stocks, particularly, were hit hard, with the KBW Nasdaq Bank Index (BKX) slid 3.9%. Among the biggest U.S. banks, Wells Fargo (WFC) sank the most, -4.7%.
While banks often benefit from higher interest rates, in that they are able to collect more interest from the loans they provide, the demand for loans declines as it becomes more expensive to borrow. With higher rates, specifically, demand for mortgages also tumbles. And if the Fed tightening leads to a recession, defaults on loans will increase.
Wells Fargo (WFC) has been one of the biggest mortgage lenders for years, but is scaling back its presence in the sector. The bank reportedly laid off hundreds of mortgage bankers this week and it aims to create a more focused home lending business.
At the same time, banks will also be pressured to pay more interest on deposits as account holders shop for the best rate.

I think Yogi is right here, though, that the KRE ETF did actually fall on Thursday and Friday.

It did. My point though was that it fell almost 5% prior to Thursday...a somewhat curious 3 day move for that index with no news...

Quick take : No losses associated with the resolution of Silicon Valley Bank will be borne by the taxpayer.
Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.
Federal Reserve Board on Sunday announced it will make available additional funding to eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors.
My TAKE : If you're dumb enough to put more than $250 K into one account , you need to have your hand slapped !!

So much for the $250,000 FDIC insurance. Everyone gets their money back.

Saw somewhere -
Interesting FDIC has 125billions. On the hook 25billions now .

https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312b.htm
https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312a.htm
Notes to follow.
Signature Bank, NY also closed.
ALL depositors of Signature AND SVB Bank will be protected - insured & uninsured.
Stock and debt holders will not be protected.
New BTFP facility for 1-yr collateralized loans with $25 billion funding coming from Exchange Stabilization Fund.
Fed Discount Window access to be easier.

What I find odd is that KRE, the regional bank ETF simply didn't move lower on Thursday and Friday. They were leaking oil beginning Monday, down over 16% for the week. Someone knew what was happening before the press and the public became aware.

KRE fell -8.11% on Thursday, -4.39% on Friday.
https://stockcharts.com/h-sc/ui?s=KRE&p=D&b=5&g=0&id=p16451725406

Schwab ran into problems in ‘08 with their “Yield Plus” ultra-short. Apparently they led investors to believe it was a safe, suitable substitute for a money market fund. It was down less than 4% when this article published in ‘08. But ISTM the fund ended up losing a lot more before it was all over.
[snip]

"The Securities and Exchange Commission today charged Charles Schwab Investment Management (CSIM) and Charles Schwab & Co., Inc. (CS&Co.) with making misleading statements regarding the Schwab YieldPlus Fund and failing to establish, maintain and enforce policies and procedures to prevent the misuse of material, nonpublic information. The SEC also charged CSIM and Schwab Investments with deviating from the YieldPlus fund's concentration policy without obtaining the required shareholder approval."
"The SEC also filed a complaint in federal court against CSIM's former chief investment officer for fixed income Kimon Daifotis as well as Schwab official Randall Merk, who is an executive vice president at CS&Co. and was president of CSIM and a trustee of the YieldPlus and other Schwab funds. The SEC alleges that Daifotis and Merk committed fraud and other securities law violations in connection with the offer, sale and management of the YieldPlus Fund."
"The YieldPlus Fund is an ultra-short bond fund that, at its peak in 2007, had $13.5 billion in assets and more than 200,000 accounts, making it the largest ultra-short bond fund in the category. The fund suffered a significant decline during the credit crisis of 2007 and 2008. Its assets fell from $13.5 billion to $1.8 billion during an eight-month period due to redemptions and declining asset values."
Link

https://morningstar.com/articles/1143550/which-funds-are-taking-the-biggest-hit-on-silicon-valley-bank-and-other-bank-stocks
It's one thing for a fund in general to hold bank stocks. It's another for an active fund with a manager to bet big on SVB. Did these managers not look at the bank's capital/balance sheet and see that it was heavily invested in long-term bonds in a rising rate environment, while also facing tech sector depositor withdrawals? In this regard, Diamond Hill Mid Cap, usually a careful risk-conscious shop, deserves to be dinged. As do, BBH and Sound Shore and Franklin Mutual. From the article:

In [Diamond Hill Mid Cap's] shareholder commentary from the end of 2022, manager Chris Welch acknowledged the stock was facing difficulties. “Regional banks First Republic and SVB Financial were pressured amid a rising rate environment, which is weighing on net interest margins.”
Welch singled out the unique position of Silicon Valley Bank. “SVB Financial faced additional headwinds given its exposure to the innovation economy, its primary area of focus—though we believe such an environment offers the company an opportunity to add tremendous value for its clients and cement its leadership position in a lucrative space,” he wrote.

IT appears, as I posted elsewhere that SVB had not had a risk officer since Dec 2021. The last one resigned with all her stock. The CEO actively lobbied Fed to avoid being required to do a stress test. Exposed far far more than what is even "adventurous" to interest rate risk with all depositors from same industry therefore likely to all act at the same time.
Begging his friends and long time customers, like Peter Thiel to "Stand by us as we have stood by you" CEO found out the hard way how much customer relationships matter to people like Thiel and in general in Silicon Valley.
So assuming they sold everything they could to pay the depositors, the question is how big are the remaining accounts that have not been liquidated, and what they can get for the people, the relationships (?) etc
I read their loans were only about 30% of assets. These are still probably good. Assume they had almost all of the rest of the deposits in their now gone bonds, and they sold them at even 70% of face value, this would imply they got 50% of total assets in sale and handed that out to depositors and then became insolvent.
FDIC covered 9% I think so they still have 41% of pre crash depositors to make whole with the loans and whatever else they can dredge up