Statement on Silicon Valley Bank Shutdown – Resources Available For Affected Companies

Statement on Silicon Valley Bank Shutdown – The 2nd largest bank failure after WaMu in 2008 and 2nd bank this year after Silvergate

Princeton, NJ, March 11, 2023 — On March 10, 2023, Silicon Valley Bank (SVB) was closed by the California Department of Financial Protection and Innovation and appointed the FDIC as receiver. The Office of the Comptroller of Currency (OCC) chartered a new national bank, Deposit Insurance National Bank of Santa Clara (DINBSC) which will serve as a mezzanine or “Bridge Bank” to facilitate customer access to insured deposits going forward (FDIC insures deposits up to $250,000 per legal entity/individual). Deposits were frozen on Friday and the FDIC made a statement saying “all insured depositors will have full access to their insured deposits Monday morning, March 13, 2023.”

Ben Jen Holdings and its direct affiliates have no banking relationships or direct exposure with Silicon Valley Bank and have it’s holdings diversified across a multitude of national and regional banking providers.

The FDIC deposits a legal entity customer that generally has a separate EIN or TIN. Individual owners of the business are treated separately for FDIC insurance purposes. For example, if Entity-A had $500,000 of deposits held at SVB spread across a checking account with $100,000 and a savings account with $400,000; $250,000 is fully insured and is available at DINBSC for withdraw on Monday and the remainder $250,000 is Entity-A’s unsecured claim with the receiver. The order of preference for payment of claims with the FDIC as receiver is as follows: (1) secured creditors, (2) uninsured deposits, and (3) general creditors.

Polsinelli has an article that explains the process in excellent detail and depth (Ben Jen Holdings holds no affiliation with Polsinelli PC and cannot guarantee the accuracy of any content that they publish):

We are working with affected portfolio companies that have reached out to us with assistance on how to resolve short term cash-flow issues pertaining to their banking relationships with SVB. We are here to provide you with any assistance you may need and our ecosystem of partners is very strong and vast, including partners in the banking sector that are prepared to step in to assist.


Polsinelli PC Statement:

AngelList Build Lifeline Agreement:

Emergency Bridge Loan from Brex:

Emergency Payroll Financing from Capchase: