Who Is Tim Mayopoulos, the New CEO of Silicon Valley Financial institution?

0
5


Silicon Valley Financial institution—which is beneath federal authorities management after turning into the second-largest financial institution failure in U.S. historical past final week—has a brand new CEO, Tim Mayopoulos.

Mayopoulos, who has different disaster expertise, says that enterprise will stick with it as standard whereas he works to unwind the financial institution’s belongings.

The Federal Deposit Insurance coverage Company (FDIC) was fast to intervene on Friday after Silicon Valley Financial institution confronted a financial institution run within the face of mounting issues over its money circulation and belongings that had declined in worth.

On Monday, Mayopoulos–

The businessman brings many years of authorized and monetary management expertise, notably his time as president and CEO of Fannie Mae, a government-sponsored firm that buys and ensures house loans. He led Fannie Mae at a time when it was nonetheless recovering from the 2008 monetary disaster.

Mayopoulos has acted quick to deal with the problem at Silicon Valley Financial institution, reaching out to the financial institution’s shoppers with a letter of reassurance on his first day.

“I stay up for attending to know the shoppers of Silicon Valley Financial institution,” he wrote Monday. “I come to this function with humility. I additionally come to this function with expertise in these sorts of conditions.”

Right here’s what to know.

Who’s Tim Mayopoulos?

Mayopoulos attended Cornell College in his undergraduate years the place he studied English till 1980, earlier than he graduated from New York College College of Regulation in 1984. Mayopoulos has mentioned that he comes from a humble background and that he attended Cornell with a beneficiant monetary help package deal, which opened new alternatives for him.

He started his profession after regulation college by clerking for a U.S. district court docket decide. Mayopoulos then labored at a regulation agency, and from 1994 to 1996 he served on the federal Whitewater investigation into Invoice and Hillary Clinton’s actual property dealings. Within the 2000s, Mayopoulos held senior roles at Deutsche Financial institution and Credit score Suisses earlier than serving as Financial institution of America’s normal counsel for 5 years. He was dismissed from the place after the financial recession in 2009 after Financial institution of America acquired Merril Lynch.

Mayopoulous joined Fannie Mae months later as normal counsel, vice chairman and company secretary. In 2012, he took over as the corporate’s President and CEO, positions he saved for the following six years.

Below his tenure, Fannie Mae recovered from the recession and applied new know-how to deliver extra security and transparency to mortgage lending. He moved on in 2019 to function president at Mix, a cloud-based software program firm that processes mortgages and client banking.

After the FDIC took management of Silicon Valley Financial institution final week, the company tapped Mayopoulos to be the corporate’s new CEO. Proper as he took up the function, Mayopoulos assured shoppers that the lender would proceed “conducting enterprise as standard.”

“We’re right here to serve you,” he wrote in a letter to shoppers. “I acknowledge the previous few days have been a particularly difficult time for our shoppers and our staff, and we’re grateful for the help of the wonderful group we serve.”

Within the letter, Mayopoulos defined that the FDIC transferred all belongings held by Silicon Valley Financial institution to an FDIC-operated “bridge financial institution” referred to as, “Silicon Valley Financial institution, N.A.,” the place depositors have full entry to their cash and each current and new deposits are protected.

The Federal Reserve and authorities introduced on Sunday that even clients with deposits over the $250,000 FDIC insurance coverage restrict would have full entry to their funds.

The previous CEO

Earlier than Mayopoulos stepped in, Silicon Valley Financial institution had been led by Becker since 2011. The FDIC introduced that Becker had been ousted from the function on Friday.

The difficulty actually kicked off on March Eight when the financial institution made a shock announcement that it was trying to lift money by way of a sale of inventory, and that it had offered $21 billion in belongings at a $1.Eight billion loss in an try to sustain with withdrawals in deposits.

In a letter to shoppers March 8, Becker urged them to not pull funds out of the financial institution, saying that Silicon Valley Financial institution may climate the stress. However, he admitted that buyer deposits had are available decrease than forecast final month. On March 9, amid immense panic, clients had tried to tug $42 billion out of Silicon Valley Financial institution, and its guardian firm—SVB Monetary—noticed a 60% drop in inventory worth. By the tip of the day, Silicon Valley Financial institution had a unfavourable money steadiness round $958 million.

On March 10, the FDIC closed the financial institution and took it over.

Becker has been closely criticized for promoting $3.6 million in Silicon Valley Financial institution inventory lower than two weeks earlier than the collapse. The sale was a part of a inventory sale plan that was filed in January.

Silicon Valley Financial institution shoppers and staff have since blamed Becker largely for spreading panic that led to the financial institution’s collapse. Becker has reportedly apologized to staff.

“It’s with an extremely heavy coronary heart that I’m right here to ship this message,” Becker mentioned in a video to employees on Friday, in keeping with Reuters. “I can’t think about what was going by way of your head and questioning, you recognize, about your job, your future.”

Extra Should-Reads From TIME


Contact us at letters@time.com.



Supply hyperlink

LEAVE A REPLY

Please enter your comment!
Please enter your name here