These companies held money at Silicon Valley Bank and aren’t sure if they’ll recover the funds
CNN
By Ramishah Maruf, CNN
Roku held approximately $487 million of its $1.9 billion in cash at Silicon Valley Bank, which collapsed Friday and was taken over by the Federal Deposit Insurance Corporation, the streaming technology company disclosed in an SEC filing.
That’s approximately 26% of the company’s cash and cash equivalents, Roku said, adding that most of its deposits with the bank are uninsured.
“The company’s deposits with SVB are largely uninsured,” Roku said. “At this time, the company does not know to what extent the company will be able to recover its cash on deposit at SVB.”
However, Roku said it has enough existing cash and cash flow from operations to “meet its working capital, capital expenditures, and material cash requirements from known contractual obligations for the next twelve months and beyond.”
SVB collapsed Friday morning after a stunning 48 hours in which a bank run and a capital crisis led to the second-largest failure of a financial institution in US history.
California regulators closed down the tech lender and put it under the control of the FDIC.
The FDIC is acting as a receiver, which typically means it will liquidate the bank’s assets to pay back its customers, including depositors and creditors.
Depositors should have access to their insured deposits by Monday morning, the FDIC said. But the FDIC insured limit is $250,000 — many depositors had cash amounts in the millions stored at SVB. Companies may have gotten money out during the bank run.
FDIC said it will pay uninsured depositors an advanced dividend within the next week, and they will get a receivership certificate for the rest of their uninsured funds.
“As the FDIC sells the assets of Silicon Valley Bank, future dividend payments may be made to uninsured depositors,” the FDIC said.
Other companies face fallout
Roblox also said in a filing that 5% of its $3 billion in cash was held at SVB. The video game company said the collapse will not affect its day-to-day operations.
Toronto-based AcuityAds Holding had US $55 million in SVB, and just US $4.8 million elsewhere. That means more than 90% of the company’s deposits were held in SVB.
In a statement, the company said it requested a trade halt and its remaining cash “will be used to support continuing operations.”
Crytpo lender BlockFi, which filed for bankruptcy in November, disclosed it held $227 million with SVB in a bankruptcy filing Friday. BlockFi said in November it had halted withdrawals after facing “significant exposure” to Sam Bankman-Fried’s FTX exchange, as well as its sister hedge fund Alameda.
BlockFi’s money in SVB is not FDIC-insured because it was in a money market mutual fund, the company learned from its bankruptcy trustee early this week.
And aerospace manufacturer Rocket Lab held almost 8%, or approximately $38 million, of its total cash at the collapsed bank, it said in a Friday filing.
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