A document from the Federal Deposit Insurance Corp., which the agency said it mistakenly released unredacted in response to a Bloomberg News Freedom of Information Act request, provides one of the most detailed glimpses yet into the bank's big customers.
The FDIC, which has been selling off pieces of the bank since its failure, asked that Bloomberg destroy and not share the depositor list, saying the agency intended to "partially" withhold some details from the document "because it included confidential commercial or financial information," according to a letter from an attorney for the regulator. The agency subsequently declined to comment on the substance of the information in the document.
U.S. regulators' decision to declare a "systemic risk exception" and make all depositors at Silicon Valley Bank whole came after a white-knuckled weekend as tech founders digested SVB's collapse on March 10. President Joe Biden described the solution as one that "protects American workers and small businesses, and keeps our financial system safe."
But the decisions that government agencies, including the FDIC, made in a frantic few days after SVB failed were immediately controversial. Some critics said that making all depositors whole at the lender and Signature Bank, which failed March 12, created a moral hazard. A fierce debate is also raging over whether the insurance limit needs to be raised for businesses.
In May, the FDIC proposed tagging the largest banks with billions of dollars in extra fees to replenish the U.S. government's bedrock deposit insurance fund after it was tapped to backstop deposits above the $250,000 threshold. At the time, the regulator estimated the decision to cover all depositors at SVB and Signature cost the fund about $15.8 billion.
FDIC Chairman Martin Gruenberg has previously said that at SVB the guarantee to uninsured depositors covered small- and mid-size businesses, as well as those with very large balances, and that the bank's top 10 depositor accounts held $13.3 billion total.
The new document underscores that in addition to serving a legion of startups and fledgling businesses, SVB was a go-to bank for tech industry giants, including some that have kept their relationships with the bank confidential.
The $1 billion that Sequoia, the firm famous for backing iconic companies including Apple, Google and WhatsApp, had at SVB made up a fraction of its $85 billion assets under management. In addition to maintaining its own accounts at the lender, the firm also recommended every startup it backed do the same, Michael Moritz, a partner at the firm, wrote in the Financial Times.
A representative for Sequoia declined to comment on the depositor list.
Kanzhun, which had $902.9 million in deposits with SVB according to the document, didn't respond to multiple emailed requests for comment. The company, which was heavily backed by Chinese giant Tencent before it went public on the Nasdaq in 2021, was among the largest Chinese companies to IPO in the U.S. that year.
Other firms included:
- Altos Labs, a life sciences startup that works on cell regeneration, had $680.3 million in deposits with the bank. The privately held company has raised $3.27 billion from billionaires including Jeff Bezos and Yuri Milner, as well as Mubadala Investment Company and other investors. An Altos representative declined to comment.
- Payments startup Marqeta Inc. had $634.5 million at the bank, according to the document. In a statement, the firm acknowledged that it had "significant deposits" at SVB, but was already in the process of moving money to other banks.
- IntraFi Network, which provides deposit services to financial institutions, had $410.9 million worth of deposits at the bank, according to the document. However, in a statement, the firm said that it didn't actually have any of its own money with the lender, nor was it a client. The amount, rather, represents the funds of almost 2,000 different depositors whose balances were fully insured when SVB collapsed, according to IntraFi.
- Crypto stablecoin company Circle Internet Financial previously disclosed its SVB deposits, which at the time represented 8.2% of the reserves backing its USD Coin. A spokesman said the company had no additional comment. The document listed it as SVB's biggest depositor with a balance of $3.3 billion.
- Streaming set-top box maker Roku Inc. also previously disclosed having roughly 26% of its cash and cash equivalents parked at the bank. The document listed its balance at $420 million. A Roku spokesman declined further comment.
- Fintech company Bill.com previously disclosed it had roughly $670 million at the bank. The firm said the amount included about $300 million of its money and $370 million that belonged to customers. A company spokesman declined further comment. The FDIC document listed Bill.com's total balance at $761.1 million.
Silicon Valley Bank and parent SVB Financial Group Inc. were also listed as having a combined $4.6 billion in deposits. SVB Financial has argued in its bankruptcy case that at least $2 billion in deposits the parent had with the bank should be returned. Federal regulators have said SVB Financial, which declined to comment on the document, must apply to the bank's receiver for that money.
