Fears over the closures of Silicon Valley Bank in California and Signature Bank in New York felt across the country
Virginia Tech economics professor Jadrian Wooten said over the weekend, people worried the closures might impact smaller regional banks.
But since the federal government announced it would repay customers’ deposits, Wooten says the closures really won’t impact southwest Virginia. He said it’s common for banks to close, about 1 to 2 close in the US every year.
The problem is when it becomes a bank run, like what happened at Silicon Valley Bank.
“People heard that they were having trouble, so they took their money out. Eventually, there was no money to be taken out,” said Wooten.
Wooten said this is completely different than when the housing market crashed in 2008.
“You could sort of think about it as investing in the wrong stocks wasn’t related to people going and taking their money out,” said Wooten.
Michael Shelton, a registered financial consultant and the owner of 360 Wealth Consulting in Roanoke, said this is the biggest crash since 2008.
Shelton’s advice: use credit unions, which typically have stricter loan policies. Also, check your accounts and diversify your investments.
Wooten said to choose federally insured banks, because you’ll be reimbursed up to $250,000.
If you have more than $250,000 in the bank, make sure to split that up into different accounts or separate banks.