With the fall of Silicon Valley Bank last week, numerous companies and company owners have been progressively transferring to a safer location. There has been widespread fear over the situation in every industry.
Economists are still debating the ramifications and potential systemic concerns that the experience highlighted as SVB collapsed over several frenetic days, causing chaos and panic among startups and lenders worldwide.
According to sources, Silicon Valley Bank’s bankruptcy has affected Apple Inc.’s primary iPhone manufacturer in a $100 million indirect way, adding to the list of financial and technological institutions that have been adversely affected by the startup’s demise.
According to Chairman Young Liu, Hon Hai Precision Industries Co. of Taiwan parked money with investment firms, which later distributed it to companies that had accounts with the California lender.
He told reporters after the results were announced on Wednesday that while it is currently carefully scrutinizing its books, it anticipates little impact because the Fed has guaranteed SVB’s deposits.
The response from the Asian company demonstrated how the dramatic collapse of a bank that was previously unknown outside of Silicon Valley is having a significant global impact.
The leading producer of iPhones and other electronics for companies like HP and Sony is Hon Hai, often known as Foxconn, which keeps the majority of its operations in China.
“The good news is that the US government has guaranteed the full return of all deposits and I believe the damage will be minimized,” he said. “We don’t see systemic risks to our investments.”