Do you have a source for this?
The first relevant link in DDG is a statement by the Chairman of the FDIC. He claims that the top ten accounts held more than 13.3B between them, which is more than 10% of the total of all deposits in the bank, and more than half of the $20B that the government is expected to payout in total. [1][2]
The FDIC would otherwise have had to pay a scant 3M of that, so there's 2/3 of the bailout just in those 10 accounts. If we include the next ten accounts, it will be much, much more. (One of the articles at the time claimed more than 85% went to 15 accounts, but I didn't want to be extreme without time to research sources.)
[1]: https://www.banking.senate.gov/imo/media/doc/Gruenberg%20Tes... [2]: https://www.fdic.gov/news/press-releases/2023/pr23023.html
At the time of the collapse there were definitely articles making that claim, with analysis and numbers, and I still assume it to be correct.
When I saw this, I was surprised, it seemed too clean and straightforward. Will have to look for the original sources.
Looking at the source you provided from the Chairman of the FDIC, it actually says that the top ten accounts held $13.3B - not _more than_ $13.3B, as you claimed. The next ten accounts necessarily held less than that, so say a generous upper bound at $26.6B for the top twenty accounts. In order for them to get at least half of the bailout, they would have needed to hold north of $55B in aggregate. The FDIC itself would have to have gotten the size of SVB's largest depositors wrong by over double in order for your original claim to be true, in the absolute most generous case.
Canada is dominated by five enormous banks, they are closely regulated, and Canada has had a better experience than USA with both fewer bank failures and higher real interest rates paid to customers.
In fact a Canadian bank would rather loan money to an American business to buy out a Canadian business than to lend the same Canadian business to expand.
FDIC is supposed to protect smaller individual depositors, not gigantic companies with hundreds of millions of dollars in deposits. Gigantic companies have financial teams that should be tasked with protecting their operating capital.
FDIC is also a last-resort. The idea is that bank assets are sold off and all depositors are made whole. It's very difficult and time-consuming to do this with a mega bank though.
Maybe FDIC limits should be raised, but the problem with that is someone needs to pay for it. Perhaps companies with $100MM deposits should be paying for private insurance.
What makes this even worse, is that Yellen would have lost nothing had she said they would back every bank and not just large banks - small bank failures are just not that common, and the risk is low, (and can be walked back in two years when the tension lowers).
Even worse, well over half of the SVB bailout went to <20 accounts.
IMO, they should have raised the amount that FDIC is insuring, which is unquestionably too low. [They still should do that.] They then should have insured everyone equally up to that point. And if Circle and Roku would lose 90% of their value from such a move, that beats the whole banking system consolidating into one or two massive players that can act with impunity.
OK, I am not an economist, and admit that I probably don't know what I am talking about, but HN is full of smart people with domain knowledge. Please (gently) broaden my perspective.