SVB's wealth management fallout

Silicon Valley Bank’s spectacular implosion last Friday has spawned a rapid-fire chain of reactions, with little end in near-term sight — and some big questions for the wealth management industry. In the span of just four days, we’ve seen:?

* An extraordinary reponse by regulators, who said yesterday they will make all depositors whole at SVB and Signature Bank of New York after the latter was shut down the same day by regulators.

* A plunge in bank stocks, including at one point today a more than 70% drop in shares of First Republic Bank, a commercial bank and wealth manager now backstopped by the Federal Reserve and JPMorgan Chase.

* Remarks by President Joe Biden on Monday that the U.S. banking and financial system is healthy, regulators will do what’s needed to maintain order, and global markets, where bank stocks have also dropped, can feel safe.

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The drama is also spilling over into wealth management. Silicon Valley Bank had a stable of financial planning and wealth management divisions, from registered investment advisory firms to a broker-dealer.?

But as regulators seek to auction off the entire bank in one package, it’s fueling questions among deal makers and a scrum by advisors to find safer waters. On Monday, HSBC said it was acquiring the U.K. subsidiary of the bank for 1 pound ($1.21).

Read more: Post-collapse, here's what's next for Silicon Valley Bank's wealth management business

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