Exclusive: Months before it became the second-largest bank in U.S. history to fail, Silicon Valley Bank quietly laid off 100 to 120 employees, according to an internal email seen by NBCNews.
. Higher interest rates from the Federal Reserve had pushed tech companies into undoing Covid-era hiring, as management hunkered down for what they worried would be a slowing U.S. economy.
In late 2022 and into the beginning of 2023, Silicon Valley Bank noticed that deposits were starting to drip out, as, venture capital funds and private equity firms adjusted to the interest rate environment. “We’re going to look to cut costs in other areas,” Silicon Valley Bank CEO Gregory Becker told analysts on an earnings call Jan. 19. The bank’s CFO, Daniel Beck, added that “cheaper full-time employees” would help to “optimize that spend.”the day the FDIC took over, with a retention bonus due on April 1. To keep SVB employees from quitting, the FDIC promised to pay 1.5 times their normal rates for 45 days to ensure an orderly wind down of the bank.
“We are open for business. Therefore we are reverting back to our regular pay rates,” said an email, seen by NBC News, from SVB’s human resources team sent Monday night.
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