After the March 10 collapse of Silicon Valley Bank (SVB), information about the company's operation has been coming to light, including reports that most of the financial institution's 8,500 staff were working remotely up until the moment regulators with the Federal Deposit Insurance Corporation (FDIC) seized the bank.
According to the Financial Times, one former banker said, "Some people worked from Miami, some moved to Las Vegas or a cabin in the woods and did the digital nomad thing
A former SVB executive said, "This is a west coast bank that operates at the heart of innovation and is . . . empathetic and dependent on relationships. It is not cut-throat like Goldman Sachs."
The bank's top leadership worked from home including Greg Becker, SVB's CEO, who was working from Hawaii. Its president, Mike Descheneaux, was working from Florida, and Laura Izurieta, the company's chief risk officer, was working from a home in the Washington suburbs.
"If our time working remotely has taught us anything, it’s that we can trust our employees to be productive from wherever they work," the company's career site said.
Last month, SVB included in its annual report the massive number of employees working from home as a risk to the business.
The bank "may experience negative effects of a prolonged work-from-home arrangement," the report stated.
According to Axios, SVB was the 16th biggest bank in the US before its collapse, which was brought on by a lack of accounting for risk due to the repercussions of a high-interest rate financial environment, as the US is seeing now.
Financial Times reports, "At the centre of SVB’s demise is a decision by management at the height of the pandemic — when a tech investment boom meant it was flooded with new deposits — to lock up half of its assets in a $91bn portfolio of securities that made it vulnerable to rising interest rates."
SVB was a significant banking institution for venture-backed companies and tech companies. On March 8, SVB announced it needed to raise capital in the amount of over $2 billion because of a $1.8 billion loss on asset sales. Shares then fell 60 percent on March 9 and another 60 percent the following day, when depositors started a "run on" the bank, meaning they all started withdrawing their money at once.
Join and support independent free thinkers!
We’re independent and can’t be cancelled. The establishment media is increasingly dedicated to divisive cancel culture, corporate wokeism, and political correctness, all while covering up corruption from the corridors of power. The need for fact-based journalism and thoughtful analysis has never been greater. When you support The Post Millennial, you support freedom of the press at a time when it's under direct attack. Join the ranks of independent, free thinkers by supporting us today for as little as $1.
Remind me next month