SALT LAKE CITY — In a town hall with other Utah political and business leaders, Governor Spencer Cox and Sen. Mitt Romney set out to portray a sense of calm and stability after last week's Silicon Valley Bank collapse that made headlines worldwide.
Utah is one of the biggest banking states in the nation and home to what is affectionately known as "Silicon Slopes," the multi-billion dollar tech industry that is growing rapidly in terms of economic impact, as well as political influence.
"We have one out of seven jobs in the state of Utah. We’re at 20% of the GDP in the state," said Sunny Washington, the CEO of Utah Tech Leads, the political action committee representing tech in the state.
On Monday, Silicon Slopes (also the name of the trade group representing Utah tech firms) and Utah Tech Leads held town hall meetings to answer questions and reassure nervous companies and their employees.
"It was a very intense 48-plus hours for everyone that was involved. Especially those whose deposits were at risk," said Gov. Cox.
While the Treasury Department, Federal Reserve and FDIC stepped up Sunday to assure nervous customers that all Silicon Valley Bank clients would be protected and able to access their money, the state had a plan to intervene to help local tech firms, had the federal government not stepped in with Silicon Valley Bank.
"We knew hundreds of businesses were impacted and that means thousands and thousands of employees would have been impacted and could have been devastating to our state," the governor said.
Watch full Utah banking town hall meeting below:
Asked by FOX 13 News in the town hall meeting what the state would have done, Carine Clark of the Governor's Office of Economic Opportunity said the state was ready to "cobble together some funding that we can backstop some of the challenges to make sure at least we get through the next week or two."
FOX 13 News is told hundreds of Utah tech companies had money in Silicon Valley Bank, representing the payroll of thousands of employees. But the impact was greater than that.
"It was all. All of the startups who are always vulnerable to exogenous shocks," said Gavin Christensen of Kickstart. "I would say half banked with SVB. About half whose assets were stuck, including my firm."
Washington said for many local firms, the issue going forward will be trying to make payroll. Utah Tech Leads was offering to connect people with new banks.
"It was a very stable bank, it was a reputable bank," Washington said of SVB. "To have $40 billion be pulled out in the span of a handful of days, that would be a problem for any bank to survive. What we want to do is quell the panic, allow for those that need assistance to get that assistance but then think forward how we might do risk, where we do investments, where we put that money."
At the town halls, Howard Headlee of the Utah Bankers Association said SVB itself was stable, but blamed social media posts that led to a run on the bank.
"You could have the greatest bank in the world and if all the depositors go in the same day and take all their money out? There’s nothing you can do," he told firms in a Zoom call.
Sen. Romney said he was engaged in ongoing conversations with the White House about how to respond to SVB's collapse and he was pleased with how the Biden administration has been handling it so far.
"With social media out there you can start a run on something and do something which is irrational but real," he said. "I believe the fed took the right steps and the FDIC did, the administration did. You want to know what’s going to happen from here? I feel confidently we can return to stability. I just can’t tell you when."
House Speaker Brad Wilson told Silicon Slopes firms in one of the town halls that Utah's Capitol Hill was supportive of their industry.
"From the legislature, I just think it’s important that we convey our commitment and vested interest in the success of this industry," he said. "Great people, great leaders, the ecosystem you’ve provided to our state is impactful in a way I don’t think we can convey."
