Some Silicon Valley Bank customers are struggling to withdraw money from their bank accounts, numerous sources tell australiabusinessblog.com.
The apparent spate of withdrawal attempts comes after SVB announced yesterday that it lost $1.8 billion in sales of US Treasury bonds and mortgage-backed securities it had invested in, due to rising interest rates. The bank also said it was raising more capital and investing in higher-yield products. Concerns arose, causing the share price to fall more than 50% at the time of publication.
Dozens of VCs are advising their portfolio companies to pull their assets out of the bank, sources say, while others are urging founders to at least diversify where they hold their capital. Others, meanwhile, are warning that the panic is coming too soon – perhaps due to news earlier this week that Silvergate, another bank, is closing. As a result, SVB clearly experiences deposit volatility from a subgroup of its users.
A source tells australiabusinessblog.com that parts of the SVB site are down, as is one of the customer support phones, despite using different browsers and apps to try to move their capital. Another says account access controls are now view-only, meaning users can’t make withdrawals or transfers. Others on Twitter say they can’t log into the internet banking portal in general.
A VC tells me that because the website is down, the founders of the portfolio are currently at SVB bank branches asking for cash release.
In a phone call earlier today, CEO Greg Becker told clients that the bank has “enough liquidity” to support its clients “with one exception: if everyone tells each other that SVB is in trouble, that’s going to be a challenge.” The executive asked VC clients to “keep calm. That’s my question. We’ve been around for 40 years, supporting you, supporting the portfolio companies, supporting venture capitalists.
If you have a juicy tip or clue about happenings in the corporate world, you can reach Natasha Mascarenhas on Twitter @nmasc_ or on Signal at +1 925 271 0912. Anonymity requests are respected.