The US government will give account holders at the collapsed Silicon Valley Bank (SVB) access to all their assets from Monday. This also applies to the Leiden biotech company Pharming, which had deposited tens of millions at SVB.
,,This is good news”, says Leon Melens, spokesman for Pharming. “There was confidence that it would work out, but that it is happening now is a relief.”
Pharming is regularly in the news when it thinks it has found a cure for a disease. More than a year ago, for example, the company thought to have a means to combat the rare disease APDS. They have also been busy the treatment of Covid-19.
But now there was bad news for Pharming, namely about the millions that the company has in accounts with Silicon Valley Bank and its British branch, SVB UK. According to American media, the collapse of Silicon Valley Bank is the largest bankruptcy since the credit crisis of 2008. Last week savers withdrew their savings en masse from the bank. That also seemed to cause problems for Pharming, which issued a press release late last night explaining that it had $26 million in the US accounts and $19 million in the UK.
Surgery
It seemed uncertain for a while whether Pharming would see those millions again, but an intervention by the American government seems to be working out. The British branch of SVB is taken over by the bank HSBC. “It doesn’t seem like much is going on now, but we had to communicate it. Perhaps we will see it reflected on the stock market in the short term, it is no different.”
SVB collapsed on Friday after a bank run had occurred. After a takeover by the US government, only deposits up to $250,000 were guaranteed, but the vast majority of deposits at the bank were much higher. “The total amount of credits will be reimbursed,” the statement said. “Losses in the resolution of Silicon Valley Bank will not be borne by the US taxpayer.”
“Today, we are taking decisive action to protect the U.S. economy by strengthening public confidence in our banking system,” the statement said. “This move will ensure that the U.S. banking system continues to fulfill its vital role of protecting deposits and providing access to credit to households and businesses in a manner that promotes strong and sustainable economic growth.”
Startups
The SVB did a lot of business with tech start-ups. At the end of last year, SVB managed more than USD 175 billion in assets. The Dutch biotech company Pharming also has a total of USD 45 million in its account with SVB.
The British government has also announced emergency support for start-ups that have lost their assets with SVB. This should allow them to continue to pay wages and other ongoing costs. Pharming assumes that it will receive money back from both countries.
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