'No relation to SVB': India's SVC Bank acts to calm depositors amid brand name confusion

Regulators shut down SVB on Friday after a run on the lender, with depositors pulling out as much as $42 billion on a single day, rendering it insolvent

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By Reuters

Published: Mon 13 Mar 2023, 3:10 PM

A little-known Indian bank moved to assure depositors their money is safe after the collapse of Silicon Valley Bank (SVB) in California caused confusion and concern due to a similarity in names.

Over the weekend, India's SVC Co-operative Bank (SVC Bank), issued a statement and sent text messages in English and local Marathi language to its customers in Mumbai saying it has no relation to the US lender.

"We request our members, customers and other stakeholders not to pay attention to baseless rumours and mischief-mongering ... insinuating similarities in brand names," SVC said in the statement.

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SVC, which has 198 branches across India, held total deposits of $2.23 billion in 2021-22. The statement said SVC has "robust and strong fundamentals".

Sachin Mane, branch manager at one of SVC's branches near India's financial capital Mumbai, told Reuters on Monday the lender acted as there were rumours circulating on social media about the bank's financial health.

"There were a few queries from customers but it mostly came from social media rumours ... We wanted to communicate before lot of people started asking or before it became a big issue," said Mane.

"It's just confusion."

California banking regulators shut down SVB on Friday after a run on the lender, which had $209 billion in assets at the end of 2022, with depositors pulling out as much as $42 billion on a single day, rendering it insolvent.

When one Twitter user asked SVC about "rumours about bank default", the Indian lender said "You have got the Twitter handle wrong. We are SVC Bank ... one of the leading & strongest cooperative banks in India with a legacy of 116 years."

There were no scenes of panic at two SVC branches in Mumbai suburbs that Reuters visited on Monday, with account holders carrying on usual banking activities.

One account holder showed Reuters a text message he received from SVC which asked them to not believe any rumours.

"SVC Co-operative Bank Ltd. has no relation with Silicon Valley Bank in California," it stated.

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Reuters

Published: Mon 13 Mar 2023, 3:10 PM

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