How to Keep Corporate Accounts Safe Amid Bank Collapse Jitters
Experts explain some little-used tools for setting up cash management systems and maximizing insurance.
Following the failures of US banks Silvergate Capital Corp., Silicon Valley Bank and Signature Bank, executives and business owners are realizing their corporate accounts aren’t necessarily insured by the Federal Deposit Insurance Corp.
“I don’t think entrepreneurs and executives were paying attention to that,” says corporate accountant John Pennett, a partner at Eisner Advisory Group in Iselin, New Jersey. “Historically, venture-backed or private equity-backed companies are sitting on $10 million to $15 million, because they just raised money that needs to last three to four years, and the board didn’t really care where they put the money. Now that’s going to be an area of discussion.”