By now, you may have heard that the nation’s 16th-largest bank collapsed on Friday. The feds took over Silicon Valley Bank after shares fell 60 percent, which led to a mad rush from panicked customers trying to withdraw their cash.
It was reported that employees received their annual bonuses hours before the bank collapsed. Was the timing a coincidence? According to CNBC, the payments had been processed a few days earlier, and the bank is saying employees get paid bonuses on the second Friday of every month.
Those bonuses deserve closer inspection. That bank’s bonuses range from $12,000 to $140,000 for managing directors. If those employees got paid that much for literally driving a bank into the ground and becoming the biggest bank collapse since 2008, it makes you wonder this one question; how much would they have made in bonuses if they didn’t fail spectacularly?
In 2018, SVP employees were the highest-paid in the nation for publicly traded banks. The average was $250K.
Another detail that at least looks and sounds fishy, even if it isn’t, and so far there is no indication of impropriety — but ex-CEO Greg Becker sold $3.57 million of stock two weeks before the collapse. The CFO, Daniel Beck, sold over half a million shares of stock as well.
Last month the stock price was about $288 per share. On Friday, it had fallen to under $30.
As for what the Federal government is planning on doing, the answer is nothing. Treasury Secretary Janice Yellen made the rounds on the Sunday morning news programs, and when asked if the government will bail out banks as they did in 2008, she said, “We’re not going to do that again. We are concerned about depositors and are focused on trying to meet their needs.”
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