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- FDIC Seizure of Foreign Deposits at SVB Opens Pandora’s Box at JPMorgan Chase and Citi – Which Hold a Combined $1 Trillion in Foreign Deposits with No FDIC Insurance
FDIC Seizure of Foreign Deposits at SVB Opens Pandora’s Box at JPMorgan Chase and Citi – Which Hold a Combined $1 Trillion in Foreign Deposits with No FDIC Insurance
by Pam Martens and Russ Martens Wall Street on Parade
If you have been following the banking crisis, you have likely read at least a dozen times that on March 12 federal banking regulators, with the consent of the U.S. Treasury Secretary Janet Yellen, invoked the “systemic risk exception” in order to protect both insured and uninsured depositors at the two banks that failed in March – Silicon Valley Bank and Signature Bank.
That’s why there were gasps of shock on Saturday evening at around 5:30 p.m. when the Wall Street Journal (paywall) published the stunning news that depositors in the Cayman Islands’ branch of Silicon Valley Bank had their deposits seized by the Federal Deposit Insurance Corporation (FDIC), which they are unlikely to ever see again.