Alabama banking organizations not concerned after Silicon Valley Bank collapse
MONTGOMERY, Ala. (WSFA) - The nation’s 16th largest bank, Silicon Valley Bank, collapsed Friday, losing $175 billion of customers’ money. On Sunday, Signature Bank closed its doors.
Many bank account holders are now frantically withdrawing their money, concerned that this may be a repeat of the bank failure that happened back in 2008.
President Joe Biden assured the country that the recent bank failures would not affect other bank systems, and the Alabama Bankers Association and the Alabama Banking Department agree.
“The message that we have for Alabamians today and every day is that banks are a safe place to keep your money,” said Alabama Bankers Association CEO and President Scott Latham.
“Our monitoring at this point says things are stable,” said Trabo Reed, deputy superintendent of the Alabama Banking Department.
Both the Alabama Bankers Association and the state banking department say Silicon Valley Bank failed by working with a specific type of customer.
“It banked a lot of startups in the Silicon Valley, a lot of companies that are tech-oriented types of companies,” said Latham.
“Significant, very substantial, withdrawals from the bank when it was concentrated and very specialized kinds of industry,” said Reed.
Both parties say such failure would not happen in Alabama with banks having very diverse clientele and being regulated at the state and federal levels.
“It’s a community of people that bring deposits together. There are opportunities for loans in banks and other services,” said Latham.
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