Cryptocurrency: BANK RUN PANIC Spreads Around Globe, Crypto and Gold Demand Skyrockets, FDIC Coverup

[grarpamp]

> Not your keys, Not your Money...

Situation is so bad they had to call in banksters on the WEEKEND to do
market crash protection, coverups, and news media confidence psyops...
Crypto up over 10%, Gold up ~2%, hodlers buyout all the popcorn...


SVB Latest Developments Live Blog: FDIC Auction Of Failed SVB Assets Underway

https://www.reuters.com/business/finance/regulators-urged-find-silicon-valley-bank-buyer-industry-frets-about-fallout-2023-03-12/
https://www.zerohedge.com/markets/yellen-says-government-will-help-svb-depositors-no-bailout-fed-fdic-hopes-talk-special
https://www.zerohedge.com/markets/never-seen-over-40-years-svb-collapse-sparks-bank-runs-people-wait-lines
https://twitter.com/CGasparino/status/1634960465607688200

As the countdown to the reopening of futures trading gets louder by
the second amid episodic observations of bank runs around the US, news
flow is starting to accelerate fast so this will be a placeholder post
with updates until we get major news.

1:15pm Update: In a throwback to the legendary "Lehman Sunday", when
dozens of credit traders did an ad hoc CDS trading and novation
session on the Sunday ahead of the bank's Chapter 11 filing to
minimize the chaos and fallout from the coming bankruptcy, Bloomberg
reports that the FDIC kicked off an auction process late Saturday for
Silicon Valley Bank, with final bids due by Sunday afternoon.

The FDIC is reportedly aiming for "a swift deal" but a winner may not
be known until late Sunday.  Bloomberg also reported that the
regulator is racing to sell assets and make a portion of clients’
uninsured deposits available as soon as Monday; the open questions are
i) whether there will be a haircut and ii) how big it will be. A table
from JPM's Michael Cemablest below shows historical haircuts on
uninsured depositors in previous bank crises.

We get a slightly more positive vibe from a Reuters report according
to which "authorities are preparing "material action" on Sunday to
shore up deposits in Silicon Valley Bank and stem any broader
financial fallout from its sudden collapse."

    Details of the announcement expected on Sunday were not
immediately available. One source said the Federal Reserve had acted
to keep banks operating during the COVID-19 pandemic, and could take
similar action now.

"This will be a material action, not just words," one source said.
Earlier, U.S. Treasury Secretary Janet Yellen said that she was
working with banking regulators to respond after SVB became the
largest bank to fail since the 2008 financial crisis.

As fears deepened of a broader fallout across the U.S. regional
banking sector and beyond, Yellen said she was working to protect
depositors but ruled out a bailout.

    "We want to make sure that the troubles that exist at one bank
don't create contagion to others that are sound," Yellen told the CBS
News Sunday Morning show. "During the financial crisis, there were
investors and owners of systemic large banks that were bailed out ...
and the reforms that have been put in place means we are not going to
do that again," Yellen added.

Meanwhile, more than 3,500 CEOs and founders representing some 220,000
workers signed a petition started by Y Combinator appealing directly
to Yellen and others to backstop depositors, warning that more than
100,000 jobs could be at risk.

Reuters also reports that the FDIC was trying to find another bank
willing to merge with SVB:

    "Some industry executives said such a deal would be sizeable for
any bank and would likely require regulators to give special
guarantees and make other allowances."

That said, the longer we wait without some resolution the more likely
it is that SVB's unsecured depositors will get pennies on the dollar,
according to the following (unconfirmed) reporting from Chalie
Gasparino: "Bankers increasingly pessimistic a single buyer will
emerge for SVB, laying out options for clients w money in there:
1-ride it out. 2-sell deposits for around 70-80 cents on dollar to
other financial players; borrow against deposits jpmorgan at 50 cents
on dollar."

    BREAKING: Bankers increasingly pessimistic a single buyer will
emerge for SVB, laying out options for clients w money in there:
1-ride it out. 2-sell deposits for around 70-80 cents on dollar to
other financial players; borrow against deposits @jpmorgan at 50 cents
on dollar
    — Charles Gasparino (@CGasparino) March 12, 2023

The FDIC previously said the agency has said it will make 100% of
protected deposits available on Monday, when Silicon Valley Bank
branches reopen.

There was also news for those whose money remains frozen at SIVB. BBG
notes that tech lender Liquidity Group is planning to offer about $3
billion in emergency loans to start-up clients hit by the collapse of
Silicon Valley Bank.

    Liquidity has about $1.2 billion ready in cash to make available
in the coming weeks, Chief Executive Officer and co-founder Ron Daniel
said in an interview on Sunday. The group is also in discussions with
its funding partners, including Japan’s Mitsubishi UFJ Financial Group
Inc. and Apollo Global Management Inc., to offer an additional $2
billion in loans, he said.

    “By helping the companies to survive now, I’m hoping some of them
would succeed and come back to us in the future,” Daniel said. “We’re
nurturing our future clients.” A typical loan will be a one-year
facility of $1 million to $10 million, or as much as 30% of the
balances held with SVB, Daniel said. The priority is to help companies
meet payroll expenses.

The fate of other SVB-linked entities appears to be somewhat rosier.
Bloomberg reports that Royal Group, an investment firm controlled by a
top Abu Dhabi royal, is considering a possible takeover of the UK arm
of Silicon Valley Bank following its collapse last week, according to
people familiar with the matter. The conglomerate, chaired by United
Arab Emirates National Security Adviser Sheikh Tahnoon bin Zayed Al
Nahyan, is discussing a potential buy-out through one of its
subsidiaries.