LIHU‘E — The sudden collapse of one of the nation’s largest banks earlier this week prompted a Hawaiian financial group to assure depositors that banks in the state were unaffected by the closure.
Hawai‘i Bankers Association of Honolulu said Friday that its member banks were in “strong” financial positions amid the fall of Silicon Valley Bank of Santa Clara, California.
Silicon Valley Bank, which was known for lending money to startups or tech companies that are privately held, was among the top 20 largest banks in the country at the time of its collapse on Friday, March 10.
“Hawai‘i Bankers Association member banks have strong capital. Customers can bank with confidence knowing that their accounts are safe,” said Neal Okabayashi, Executive Director of Hawai‘i Bankers Association, in a statement on Friday.
“At this point, the FDIC (Federal Deposit Insurance Corporation) has stated that this is an isolated incident, and there is no indication of systemic issues affecting the banking industry.”
Hawai‘i Bankers Association members are: American Savings Bank, Bank of Hawai‘i, Central Pacific Bank, Finance Factors, First Hawaiian Bank, HomeStreet Bank and Territorial Savings Bank.
The Federal Deposit Insurance Corporation said in a statement on Friday that Silicon Valley Bank was shuttered by the California Department of Financial Protection and Innovation.
That move led to the insurance corporation being appointed as receiver, which then led to the creation of the Deposit Insurance Bank of Santa Clara as a means to protect insured depositors.
All insured deposits of the failed bank were also transferred to the Deposit Insurance Bank of Santa Clara. The insurance corporation guarantees up to $250,000 per depositor.
“All insured depositors will have full access to their insured deposits no later than Monday morning, March 13, 2023. The FDIC will pay uninsured depositors an advance dividend within the next week,” the insurance corporation said in a statement.
“Uninsured depositors will receive a receivership certificate for the remaining amount of their uninsured funds. As the FDIC sells the assets of Silicon Valley Bank, future dividend payments may be made to uninsured depositors.”
Silicon Valley Bank had 17 branches in California and Massachusetts at the time of its collapse. The main office and all of its branches are scheduled to reopen Monday with normal business hours.
“As of December 31, 2022, Silicon Valley Bank had approximately $209.0 billion in total assets and about $175.4 billion in total deposits. At the time of closing, the amount of deposits in excess of insurance limits was undetermined,” the insurance corporation said in a statement.
“The amount of uninsured deposits will be determined once the FDIC obtains additional information from the bank and customers.”
Customers with accounts in excess of $250,000 should contact the insurance corporation toll-free at 1-866-799-0959.
Silicon Valley Bank is the first insurance corporation-insured institution to fail in 2023. The last insurance corporation-insured institution to close was Almena State Bank of Almena, Kansas, on Oct. 23, 2020.
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Wyatt Haupt Jr., editor, can be reached at 808-245-0457 or whaupt@thegardenisland.com.
Source: The Garden Island
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