Kevin O'Leary Rips Into Silicon Valley Bank Amid Collapse: 'It's No Better Than Radioactive Waste'
The "Shark Tank" star was among the millions of investors who had companies with finances that were handled through the financial institution.
By Emily Rella •
"Shark Tank" star Kevin O'Leary and his portfolio of companies were affected by the Silicon Valley Bank (SVB) collapse, and now the multi-millionaire investor is not holding back when it comes to cutting ties with the now-defunct financial institution.
Appearing on "Cavuto: Coast to Coast" on Tuesday, O'Leary sounded off about the U.S. Federal Reserve and other institutions' announcement that they would cover all depositors without the burden falling on taxpayers.
"There's going to be problems ahead here because, frankly, I don't think just guaranteeing deposits is enough to keep everybody with all of their money in just the regional bank," O'Leary said. "Going forward, I think a lot of bank managers are going to say, 'Wait a second, I have no risk ... because if anything goes wrong, as long as I stay within the baseball rules of banking, nothing can happen to me because the Fed covers all my depositors."
He also revealed that within his own investment company's portfolio, O'Leary Ventures, all assets have been transferred to "five different financial institutions" and noted that most other high-level investment companies "will do the same."
O'Leary also maintained that SVB's reputation has been completely tarnished, noting that no matter what the bank attempts to do to bounce back, it will be difficult for it to garner the public's trust.
"The franchise value of the words 'Silicon Valley Bank' has been trashed," he said bluntly. "It's no better than radioactive waste. It's become the poster boy for idiot management. So no one's going to want that brand. Not here, not anywhere. And so I'm not really confident that they're going to get bought."
O'Leary was not the only "Shark Tank" star with money handled through SVB.
Co-star and billionaire Mark Cuban was vocal on social media upon the bank's collapse about his desire for government agencies and regulators to step in and help recover the funds for companies that stood to lose the majority of their financial assets, which stands in opposition to what O'Leary thought should have been done.
"The Fed should IMMEDIATELY buy all the securities/debt the bank owns at near par, which should be enough to cover most deposits," he said via Twitter, revealing that his portfolio of companies had an estimated $8-10 million that was run through SVB, though none of those assets were his personal funds. "Any losses paid for in equity and new debt from the new bank or whoever buys it. The Fed knew this was a risk. They should own it."
Depositors were granted access to SVP funds Monday morning, though shareholders and unsecured debt holders were not protected.
