BankTown Banking & Finance News

[JRCLT]

BankTown keep Churning on living up to its moniker!

[CLT2014]

On 9/15/2022 at 5:35 AM, atlrvr said:

SVB is definitely opening their office at The Line (new building on Hawkins)

Will be interesting to see what comes of this office and SVB in the coming days or weeks given the news. Definitely one to watch.

[KJHburg]

14 hours ago, CLT2014 said:

Will be interesting to see what comes of this office and SVB in the coming days or weeks given the news. Definitely one to watch.

The stock has been halted in early trading pending news this morning.  It sounds like an old fashion run on a tech oriented bank.  Lots of losses in upstart tech companies of late and lack of VC sorta seems like the game is up.  If you there is not a path to profits you will go under.   Stay tuned. 

[stw52]

20 minutes ago, KJHburg said:

The stock has been halted in early trading pending news this morning.  It sounds like an old fashion run on a tech oriented bank.  Lots of losses in upstart tech companies of late and lack of VC sorta seems like the game is up.  If you there is not a path to profits you will go under.   Stay tuned. 

looks like GS will not provide anymore capital and SVB is up for sale according to CNBC

[stw52]

2 hours ago, stw52 said:

looks like GS will not provide anymore capital and SVB is up for sale according to CNBC

 regulator have shut it down. 

[Madison Parkitect]

2 hours ago, stw52 said:

looks like GS will not provide anymore capital and SVB is up for sale according to CNBC

Should we all pool our money and buy a bank?

[KJHburg]

2 minutes ago, Madison Parkitect said:

Should we all pool our money and buy a bank?

the FDIC has closed it and taken over.  SVB is closed.  

https://www.fdic.gov/news/press-releases/2023/pr23016.html

Their lease at the Line can be terminated unless new buyer wants it too so there is implications for Charlotte.  

[CLT2014]

That was fast. So much for those jobs coming here. 

[KJHburg]

Silicon Valley Bank is the 2nd largest bank failure in US history after Washington Mutual.   $209 B in assets.  It was an important source of funding for upstart tech companies.  

[KJHburg]

this huge SVB bank failure was unbelievably quick.  $42 BILLION  was taken out of the bank on Thursday.  No bank could survive that kind of bank run.  

https://www.cnbc.com/2023/03/10/silicon-valley-bank-collapse-how-it-happened.html

Implications for Charlotte no more SVB office unless new buyer wants one here and is not already here at the Line in Southend.   This will be studied in the future as one of the greatest bank runs in history.  2nd biggest failure in the USA ever.  

[KJHburg]

Here is what happened with SVB when the news broke in Austin at the South by Southwest festival.  Tech and VC presenters were walking off the stage during their own talks to take calls about it. 

https://www.bizjournals.com/austin/inno/stories/inno-insights/2023/03/12/svb-collapse-forces-startups-vcs-to-scramble-sxsw.html

On a local note my brothers small computer company has done work for SVB Securities here in Charlotte.  So even small companies here that have worked with their new office here will be affected by this huge bank failure.  

[KJHburg]

Just in minutes ago from the FDIC  (and yes another bank failed this time in  NY)

Joint Statement by the Department of the Treasury, Federal Reserve, and FDIC

Washington, DC -- The following statement was released by Secretary of the Treasury Janet L. Yellen, Federal Reserve Board Chair Jerome H. Powell, and FDIC Chairman Martin J. Gruenberg:   Today we are taking decisive actions to protect the U.S. economy by strengthening public confidence in our banking system. This step will ensure that the U.S. banking system continues to perform its vital roles of protecting deposits and providing access to credit to households and businesses in a manner that promotes strong and sustainable economic growth.   After receiving a recommendation from the boards of the FDIC and the Federal Reserve, and consulting with the President, Secretary Yellen approved actions enabling the FDIC to complete its resolution of Silicon Valley Bank, Santa Clara, California, in a manner that fully protects all depositors. Depositors will have access to all of their money starting Monday, March 13.  No losses associated with the resolution of Silicon Valley Bank will be borne by the taxpayer.   We are also announcing a similar systemic risk exception for Signature Bank, New York, New York, which was closed today by its state chartering authority. All depositors of this institution will be made whole.  As with the resolution of Silicon Valley Bank, no losses will be borne by the taxpayer.   Shareholders and certain unsecured debtholders will not be protected. Senior management has also been removed. Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.   Finally, the Federal Reserve Board on Sunday announced it will make available additional funding to eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors.   The U.S. banking system remains resilient and on a solid foundation, in large part due to reforms that were made after the financial crisis that ensured better safeguards for the banking industry. Those reforms combined with today’s actions demonstrate our commitment to take the necessary steps to ensure that depositors’ savings remain safe.

Edited March 12, 2023 by KJHburg

[navigator319]

4 minutes ago, KJHburg said:

Just in minutes ago from the FDIC  (and yes a small NY bank failed too)

Joint Statement by the Department of the Treasury, Federal Reserve, and FDIC

Washington, DC -- The following statement was released by Secretary of the Treasury Janet L. Yellen, Federal Reserve Board Chair Jerome H. Powell, and FDIC Chairman Martin J. Gruenberg:   Today we are taking decisive actions to protect the U.S. economy by strengthening public confidence in our banking system. This step will ensure that the U.S. banking system continues to perform its vital roles of protecting deposits and providing access to credit to households and businesses in a manner that promotes strong and sustainable economic growth.   After receiving a recommendation from the boards of the FDIC and the Federal Reserve, and consulting with the President, Secretary Yellen approved actions enabling the FDIC to complete its resolution of Silicon Valley Bank, Santa Clara, California, in a manner that fully protects all depositors. Depositors will have access to all of their money starting Monday, March 13.  No losses associated with the resolution of Silicon Valley Bank will be borne by the taxpayer.   We are also announcing a similar systemic risk exception for Signature Bank, New York, New York, which was closed today by its state chartering authority. All depositors of this institution will be made whole.  As with the resolution of Silicon Valley Bank, no losses will be borne by the taxpayer.   Shareholders and certain unsecured debtholders will not be protected. Senior management has also been removed. Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.   Finally, the Federal Reserve Board on Sunday announced it will make available additional funding to eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors.   The U.S. banking system remains resilient and on a solid foundation, in large part due to reforms that were made after the financial crisis that ensured better safeguards for the banking industry. Those reforms combined with today’s actions demonstrate our commitment to take the necessary steps to ensure that depositors’ savings remain safe.

Signature bank is the one that just went under.  if 110B+ is small IDK.  They have branches here in CLT and Raleigh also  

[KJHburg]

5 minutes ago, navigator319 said:

Signature bank is the one that just went under.  if 110B+ is small IDK.  They have branches here in CLT and Raleigh also  

It is NY based bank.  I looked up their assets after I posted that and saw $110B

 

[KJHburg]

On Friday average mortgage rates across the country dropped .25% a result of the SVB failure.  

and this just in from the FDIC
 

FDIC Establishes Signature Bridge Bank, N.A., as Successor to Signature Bank, New York, NY

WASHINGTON -- Signature Bank, New York, NY, was closed today by the New York State Department of Financial Services, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect depositors, the FDIC transferred all the deposits and substantially all of the assets of Signature Bank to Signature Bridge Bank, N.A., a full-service bank that will be operated by the FDIC as it markets the institution to potential bidders.   Signature Bank had 40 branches across the country in New York, California, Connecticut, North Carolina, and Nevada. Banking activities will resume Monday, March 13, 2023, including on-line banking. Depositors and borrowers will automatically become customers of Signature Bridge Bank, N.A. and will continue to have uninterrupted customer service and access to their funds by ATM, debit cards, and writing checks in the same manner as before. Signature Bank’s official checks will continue to clear. Loan customers should continue making loan payments as usual.   The transfer of all the deposits was completed under the systemic risk exception approved earlier today. All depositors of the institution will be made whole.  No losses will be borne by the taxpayers.  Shareholders and certain unsecured debt holders will not be protected.  Senior management has also been removed. Any losses to the Deposit Insurance Fund (DIF) to support uninsured depositors will be recovered by a special assessment on banks, as required by law.   These actions will protect depositors and preserve the value of the assets and operations of Signature Bank, which may improve recoveries for creditors and the DIF.

Edited March 12, 2023 by KJHburg

[navigator319]

Yes it’s a beautifully thing. Every action taken is credited to the reforms and tools only made available by DoddFrank reforms post 2008.

[joenc]

Is the SVB office in Charlotte, SVB bank or SVB Securities?  Not an expert, but I think SVB Securities still exists

[CLT2014]

1 hour ago, joenc said:

Is the SVB office in Charlotte, SVB bank or SVB Securities?  Not an expert, but I think SVB Securities still exists

There is a small SVB Securities office in Charlotte already (~12,000 sq. feet), but the big job expansion announced in January was for SVB Bank. The 96 job postings in the Charlotte market are largely for SVB Bank as well. 

SVB Securities will end up a stand alone company or absorbed into another company that purchases it. 

Taking a look at LinkedIn, 90 people tag their employment to Silicon Valley Bank in Charlotte while 42 tag their employment to SVB Securities. 

Edited March 13, 2023 by CLT2014

[kermit]

I am certainly not an expert on bank balance sheets but I gotta wonder if there are some opportunities here for Charlotte's banks?  While they may have certainly taken a hit today, Truist might find a nice geographic match in teetering Key Bank.  At the top of the scale, I would think regulators would relax the deposit cap limits if BAC wanted to move into acquirer mode.

Hopefully our locals can avoid a Ken Lewis -- Countrywide repeat from 2008. That said, I am under the impression that these bank capital issues are temporary mark to market issues rather than the near zeroing of asset values we saw in 2008.

Just spitballing...

Edited March 14, 2023 by kermit

[videtur quam contuor]

We should start a bank. Who is in? Take deposits from shaky sources such as venture firms, startups and crypto bros and then lend to our trading arm. Leveraged of course. FTX/Signature/SVB folk gotta go somewhere. 

[KJHburg]

SVB Securities is indeed still operation and wants to distance itself from the bank now.  Here is what I found on their website and they have the office the Line leasing one floor and have options on more.  They might want even more separation from their California roots now.  So this might be okay for Charlotte but still too early to tell yet.   But I still thought while this division opened here that the SVB bank portion was too but of course that is no more.  

SVB Securities Continues its Independent Operations Unimpeded by Silicon Valley Bank’s Receivership Proceedings | SVB Securities

[CLT2014]

Ally Financial bringing Russ Hutchinson on as CFO and he will be based in Charlotte. Will be leaving Goldman Sachs.
https://www.prnewswire.com/news-releases/ally-names-russell-hutchinson-as-chief-financial-officer-301780456.html

What other CFOs for banks with large Charlotte offices are based here?
Bank of America -> New York
Wells Fargo -> New York
Truist -> Charlotte
USAA -> Charlotte
Ally -> Charlotte
US Bank -> Minneapolis

Any other CFOs based in Charlotte for banks / bank holding companies?

Edited March 24, 2023 by CLT2014

[kermit]

Given the events of the day I thought it might be appropriate to flash back to 2007(ish) when it was heavily rumored around town (and on this site) that Deutsche Bank was about to set up a major office in Uptown. I think we dodged a bullet there, and their absence (IMO) helped us to land Truist and our substantial  collection of non-HQ regional bank activities (Ally, US Bank, USAA). I do hope the FDIC makes the correct call with increasing deposit insurance caps, the future of regional banking appears to depend on that move in the current regulatory environment where only the largest banks are stress tested.

[and a not really related but also off topic observation] Citirx [the remote work company that failed to take advantage of the opportunities provided by a global pandemic] announced they are leaving downtown Raleigh earlier in the week

https://www.bizjournals.com/triangle/news/2023/03/22/citrix-subleasing-downtown-raleigh-building.html

Edited March 24, 2023 by kermit

[CLT704]

5 hours ago, CLT2014 said:

Ally Financial bringing Russ Hutchinson on as CFO and he will be based in Charlotte. Will be leaving Goldman Sachs.
https://www.prnewswire.com/news-releases/ally-names-russell-hutchinson-as-chief-financial-officer-301780456.html

What other CFOs for banks with large Charlotte offices are based here?
Bank of America -> New York
Wells Fargo -> New York
Truist -> Charlotte
USAA -> Charlotte
Ally -> Charlotte
US Bank -> Minneapolis

Any other CFOs based in Charlotte for banks / bank holding companies?

Sort of off topic but Ally keeping the CFO here just goes to show that, for all intents and purposes, it is a Charlotte bank. I don't think Ally would ever officially move its headquarters from Detroit given the historical links to GM as GMAC, auto is still the significant portion of the business, and a lot of folk go back to the GMAC days but 1. Charlotte quietly got named the "corporate center" (a lot of press releases are just from Charlotte and not Detroit), 2. Charlotte is its largest employee hub, 3. practically every business line is represented in Charlotte with the exception of some servicing and collection activities (that are mostly in suburban Dallas, Little Rock and Jacksonville) while Detroit is concentrated with auto employees, and last but not least 4. the vast majority of executives are here with only 5 out of 16 not based in Charlotte. 

It is truly fascinating to see the growth from Ally, even in the last few years from a few hundred employees scattered across some dingy office parks to a major player. We owe a lot of that to Bank of America too, many employees and senior leadership went over to Ally from "the mothership" starting back when Alvaro de Molina went to GMAC.

[DMann]

I have been using Ally for the past 5 years and like the way the bank works!