U.S. Treasury Secretary Janet Yellen said Friday she’s tracking a number of banks as Silicon Valley Bank has faced major problems.
“You mentioned Silicon Valley Bank,” Yellen said, as she responded to a lawmaker while testifying before a House Ways and Means Committee hearing.
“There are recent developments that concern a few banks that I’m monitoring very carefully, and when banks experience financial losses, it is and it should be a matter of concern.”
The stock of Silicon Valley Bank parent company SVB Financial Group
SIVB,
had plunged after the company disclosed large losses from securities sales.
Later Friday, as the committee hearing still was underway, the Federal Deposit Insurance Corporation said Silicon Valley Bank had been closed by a California regulator.
SVB has been seeking a buyer after scrapping a plan to shore up its finances through a stock offering, and as it faced widespread customer withdrawals, according to a Wall Street Journal report published earlier Friday.
Related: SVB Financial is trying to sell itself: CNBC
Sen. Sherrod Brown, the Ohio Democrat who heads the Senate Banking Committee, is “monitoring the situation closely,” a spokeswoman said Friday.
“The FDIC and other banking regulators are on the job to protect insured depositors and our banking system,” she added.
Billionaire hedge fund manager Bill Ackman had suggested that government intervention could be needed.
“If private capital can’t provide a solution, a highly dilutive government preferred bailout should be considered,” Ackman said on Twitter late Thursday.
COMP,
were lower Friday, as investors struggled to parse mixed signals in the latest jobs report and monitored Silicon Valley Bank’s troubles.
Now read: Financial-system risks put a smaller March rate hike by Federal Reserve back in play
Also see: SVB extends swoons on bank-run fears and analyst downgrades as it triggers bank-stock losses
Plus: 10 banks that may face trouble in the wake of the SVB Financial Group debacle
