Comment !apeprove! anywhere on the sub to be added to the list of pending approvals.Approved Users will bypass these karma and age restrictions entirely.Not enough karma? Post your DRS Proof /r/GMEOrphans.*total post and comment karma only, excludes award karma Community Posts Wiki || Rules || Automod Info Post Flairs 📚 Due Diligence If you have further questions about these actions or about the implications on your business of the SVB and Signature Bank receiverships, please contact the author or your DLA Piper relationship partner.A place for theoretical discussions about GameStop Stock ($GME). As part of their corporate oversight, the board of directors of the company (or the audit committee, if established) should work with company management to complete the matters contemplated above and document their attention to these matters in corporate minutes. Importantly, properly document all decision-making regarding cash management and investment to support the record of action by the company. A zero balance account is a business checking account that maintains a balance of zero by sweeping funds into and out of a main account. Consider establishing, or adjusting allocations to, deposit accounts under insured cash sweep programs – Your deposit bank may offer insured cash sweep (ICS) programs that sweep excess cash into secure investments that are not subject to credit risk of the deposit bank.Companies should discuss and have contingency plans in place for addressing similar issues in the future. Consider alternative liquidity structures – Many companies rushed to put in place bridge loan facilities or equity raises to stem a potential liquidity crisis.
Review your commercial contracts – For companies holding letters of credit as a beneficiary, review the terms of the applicable contracts that require letters of credit to determine any rights to demand replacement letters of credit from other financial institutions or cash collateral.Recent events may also provide an opportunity to renegotiate with banking partners the scope of any covenants that would impact the company’s investment policy. There may be exceptions to rules which place limitations on the company’s ability to put in place its investment policies. Loan agreements generally survive bank takeovers and borrowers are expected to continue to comply with their terms. Review your loan documents – If the company has loans with financial institutions, review the affirmative covenants to determine if there are limitations on the company’s ability to set up bank accounts and investment accounts at other financial institutions or hold cash in other bank accounts.Review any cash management services – The company should carefully review all sweep allocations, customer deposit instructions and auto-debit arrangements as they may need to be adjusted, turned off or replaced based on service availability and stability with deposit banks.Investment policies should reflect that certain kinds of accounts and cash equivalents are protected from the credit risk of the deposit bank.
Bank of america sweep account update#
On March 10, 2023, Silicon Valley Bank (SVB) was closed by the California Department of Financial Protection and Innovation, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. With the most pressing short-term impacts now stabilized, corporate boards and management should consider steps to be better prepared in the future. The failures of Silicon Valley Bank and Signature Bank sent many companies into credit and liquidity crises.
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