After the collapse of Silicon Valley Bank (SIVBQ) earlier this week, art institutions across the U.S. will likely suffer financial setbacks in corporate sponsorships and philanthropic contributions.
Silicon Valley Bank (SVB), a regional bank based in Santa Clara, California, was shut down by federal regulators on March 10, after a bank run drained its deposits. The bank specialized in financing for venture capital-backed startups and held more than $212 billion of assets as of September 2022.
Financial turmoil stemming from the bank’s collapse has had repercussions across the country. On March 12, state regulators closed Signature Bank (SBNY), a regional bank based in New York which held around $100 billion in assets and focused on real estate lending and cryptocurrency deposits.
Signature Bank was also a prominent supporter of museums and arts institutions. The bank’s philanthropic contributions in 2021 and 2020 totalled $2 million and $3 million respectively, with a portion of these donations earmarked for arts organizations such as the San Francisco Opera, according to its annual social impact reports.
The 2008 crisis led to closures across the art world
Signature Bank additionally provided a number of loans to theaters and operas under the federal Paycheck Protection Program (PPP), established in 2020 to help small businesses survive the Covid-19 pandemic. Million-dollar loans were granted to organizations like the San Francisco Opera, American Conservatory Theater, Atlantic Theater Company and Berkeley Repertory Theatre, according to PPP data provided by CNN.
Signature Bank declined requests for comment.
First Republic Bank, another financial institution suffering from SVB’s collapse, has also been a prominent backer of arts organizations. While the San Francisco-based regional bank remains open, its shares fell by more than 70 percent on March 13.
First Republic Bank donated between $100,000 and $250,000 to the San Francisco Ballet and is a corporate sponsor of the San Francisco Museum of Modern Art, as reported by the San Francisco Standard. The bank is also a corporate sponsor of New York’s Lincoln Center for Performing Arts, Whitney Museum and Gallim dance company, in addition to sponsoring San Francisco’s Asian Art Museum and annual Design Week festival.
First Republic Bank did not respond to requests for comment.
The collapse of SVB and Signature Bank represent the second and third largest failures in U.S. banking history respectively, just behind the demise of Washington Mutual during the 2008 financial crisis.
At the time, the crisis led to increased layoffs and slashed wages amongst museums and cultural centers stemming from a loss in endowments, donations and public funding. Some institutions, such as the Connecticut Opera, the Baltimore Opera, American Musical Theatre of San Jose and Minnesota Museum of Art were forced to close down all together.