Since it serves as receiver for the failed lending institution, the Federal Deposit Insurance Corporation added a few more people to its payroll late Friday, hiring staff members from the defunct Silicon Valley Bank, at least temporarily.
According to a copy of the letter obtained by Bloomberg, the newly-established organisation, the Deposit Insurance National Bank of Santa Clara, or DINBSC, wrote a letter to staff offering 45 days of employment. The letter adds that the employees will be let off after the 45-day period.
According to its annual filing, the company and its subsidiaries employed more than 8,500 employees across the globe as of December 31. The Santa Clara, California headquarters of SVB and all of its branches will reopen on Monday, according to the FDIC.
The FDIC is paying paid employees 1.5 times their present pay as an incentive to stay at the bank for that 45 days. The offer states that hourly employees who work overtime would be paid double.
The FDIC, a US federal body that protects deposit products like savings accounts and money market accounts up to a specific limit, says the arrangement is not unusual.
A spokesman for the FDIC stated that asking workers to cooperate with us during the resolution process is typical procedure. One of the first things we do after receiving the position is this.
On Friday, regulators took control of Silicon Valley Bank following a run on the bank’s accounts and a failed attempt to raise cash. Since the financial crisis, its fall is the worst failure of a US bank.
In order to refund as much client money as possible, the FDIC is currently working to identify purchasers for the company’s numerous companies.
Employees at the company are faced with a difficult decision: leave now and hunt for other employment, or stay and hope DINBSC finds purchasers. This decision is being made over the weekend in exchange for a greater pay and the possibility of continuing benefits.