Anxiety is high as business owners frantically wait to see if millions of funds can be accessed afterSilicon Valley Bank shut down.
The bank, based in Santa Clara, California, is one of the nation’s top 20 largest banks.
In an interview with CBS’ "Face the Nation" Sunday, U.S. Treasury Secretary Janet Yellen said the government will not bail out the tech lender and instead focus on helping depositors.
She also added that the situation is different from the financial crisis over a decade ago.
"We’re not going to do that again. We are concerned about depositors and are focused on trying to meet their needs," said Yellen.
Friday’s collapse made it the second-largest U.S. bank closure since the 2008 financial crisis.
The bank failed after it told investors it needed to raise billions in funds, prompting its customers to panic and withdraw $42 billion of deposits, causing a run on the bank.
That’s when the federal government took control.
However, not everyone pulled their money out of the bank before it collapsed, leaving many startups stuck.
The Federal Deposit Insurance Corporation only insures deposits up to $250,000; those federally insured deposits are supposed to be made available by Monday morning.
Silicon Valley Bank seized after run by depositors
Silicon Valley, the nation's 16th largest bank, was heavily exposed to the tech industry and there's little chance of contagion in the banking sector.
But many of the banks' depositors, big-nametech companies like Roku, held millions at the bank.The concern is that companies won’t be able to pay their employees, leading to furloughs or layoffs.Friday’s collapse prompted questions about the resiliency of the U.S. banking system.
The White House budget chief addressed concerns in an interview.
"What I’ll say about the banking system overall is that it’s more resilient. It has a better foundation than before the financial crisis, and that’s largely due to the reforms put in place after the financial crisis," said Shalanda Young, director of the White House Office of Management and Budget.
During an interview on NBC’s "Meet the Press," North Dakota Republican Sen. Kevin Cramer said the situation shouldn’t prompt more regulation.
"My sense of it is that it is a very localized issue. The problem is that we live in a very emotional time where markets are emotional. The reference to social media as being an accelerator, if you will, of some of that emotion, I think can be problematic. But I hope with the weekend came some calm and certainly some strategy as well," said Cramer.
Now, as far as Silicon Valley Bank employees go, the government has offered up extra pay to those employees. As per standard practice, the FDIC offered employees 45 days of employment and one and a half times their salary.
