Federal government won’t bail out Silicon Valley bank despite fears of market crash, Treasury Secretary Janet Ellen announced on Sunday.

The bank, the 16th largest in the U.S., collapsed on Friday after shares plunged 60 percent amid declining customer deposits, prompting SVB to sell $1.75 billion in shares.

It was the worst failure of a US financial institution since 2008, with SVB controlling $209 billion in total assets at the end of 2022.

President Joe Biden, California the governor Gavin NewsomThe Treasury Department and the Federal Deposit Insurance Corporation (FDIC), which now oversees the bank’s assets, are in crisis talks to try to get other financial institutions to buy out SVB.

But the heads of the financial industry warn that the government has only until Monday so that other regional banks are not affected,

Treasury Secretary Janet Yellen (pictured) announced on Sunday that the government would not bail out the bank

Yellen told CBS News Sunday morning that a bailout like the one in 2008 was not on the cards, although she said she was worried about investors.

“Let me make it clear that during the financial crisis, investors and owners of large systemic banks were bailed out … and the reforms that have been put in place mean that we are not going to do that again,” she said.

“But we’re concerned about depositors, and we’re focused on meeting their needs.”

The FDIC said the insured funds would be available to depositors Monday morning, but only the first $25,000 of funding was FDIC insured.

As for uninsured deposits, the FDIC said it would pay depositors an “advance dividend” within the next week.

“Uninsured depositors will receive a certificate of bankruptcy administration for the remaining amount of their uninsured funds,” the agency said.

“As the FDIC sells the assets of Silicon Valley Bank, future dividend payments may be made to uninsured depositors.”

Meanwhile, the FDIC is trying to force another bank to merge with the failed institution.

They are said to be weighing the creation of a fund that would allow regulators to support more deposits, discussing the idea with bank executives in the hope it will reassure depositors and help curb payouts.

Any deal would also likely require regulators to grant special guarantees and other concessions to the financial institution that accepts the SVB.

President Joe Biden has now discussed the situation with Governor Gavin Newsom as they try to find a possible solution.

In a statement Saturday, Newsom said: “Over the past 48 hours, I have been in contact with the highest levels of leadership in the White House and Treasury.

“Everyone works with [the] The FDIC is stabilizing the situation as quickly as possible to protect jobs, people’s livelihoods and the entire innovation ecosystem that has served as the backbone of our economy.”

President Joe Biden is said to be discussing the issue with California Governor Gavin Newsom

Newsom (pictured in October) said in a statement that “everyone is working with [the] The FDIC is stabilizing the situation as quickly as possible to protect jobs, people’s livelihoods, and the entire innovation ecosystem.

The announcement came after it emerged that the Santa Clara bank was already under fire from panicked venture capital investors and startup founders – many of whom had uninsured deposits – when employees received their annual bonuses on Friday.

These payments took place a few days before SVB’s collapse, as the bank usually paid its employees bonuses on the second Friday of each month. CNBC reports.

It’s unclear how much the more than 8,500 employees received for the work they performed in 2022, but according to Glassdoor, SVB’s bonuses could range from about $12,000 for partners to $140,000 for executives.

SVB was the highest-paid public bank in 2018, with employees earning an average of $250,683.

It was also previously revealed that former CEO Greg Becker sold $3.57 million worth of stock in a pre-planned automatic sell-off just two weeks before the collapse.

In total, on February 27, it unloaded 12,451 shares at an average price of $287.42 each.

Meanwhile, CFO Daniel Beck sold 2,000 shares at $287.59 per share, giving up $575,000.

By Friday, the stock had fallen to as low as $29.49 in premarket trading before the FDIC seized the bank’s assets.

There is no suggestion of impropriety on either Becker’s or Beck’s part.

On February 27, Greg Becker (left) sold 12,451 shares at an average price of $287.42 each. SVB CFO Daniel Beck (R) sold 2,000 shares at $287.59 per share on the same day as his boss. The price fell to as low as $39.49 in premarket trading on Friday before the Federal Deposit Insurance Corporation (FDIC) seized its assets.

On February 27, Greg Becker sold 12,451 shares at an average price of $287.42 per share. The price fell to as low as $39.49 in the premarket on Friday before the Federal Deposit Insurance Corporation seized its assets.

In a video message to bank employees on Friday, Becker acknowledged the “incredibly difficult” 48 hours that led to the bank’s collapse.

“It is with an incredibly heavy heart that I come today to deliver this message,” he said in the video. “I want to acknowledge how difficult the last 48 hours have been for all of you. I care so much about all of you. It really is so incredibly difficult.

“I’m trying to look back to focus on two things. 1.) I focus on you and think about the end result of what this could be despite this incredibly difficult time. And 2.) I focus on customers.”

While the FDIC has taken control of the lender, Becker said he is working with bank regulators to find a partner for the bank, but there is “no guarantee” a deal will go through.

Becker was wearing a black zip-up jacket emblazoned with the logo of Gleneagles, a luxury golf resort in Scotland, and spoke from a room lined with dark cupboards.

“As you heard this morning, I no longer make these decisions, which is very difficult. But I’m working with the FDIC to figure out how we can get the best results for our customers as well as our employees.

“I can’t imagine what was going through your head and you were thinking, you know, about your work, about your future. My goal is to figure out how to preserve some of the value of the franchise that we’ve spent so much time building and hopefully find the right partner that the FDIC can work with to keep this institution going in some form.”

He asked employees to “hang out, try to support each other, try to support our customers, work together” to get the best result for the company.

“Thank you, and my heart goes out to you,” he said.

Sources familiar with the matter say the FDIC is allowing employees to stay an additional 45 days.

Greg Becker, chief executive of SVB Financial Group, sent a video message to staff at the bank in which he acknowledged the “incredibly difficult” 48 hours that led to its collapse on Friday.