This text initially appeared on Enterprise Insider.
The sudden collapse of Silicon Valley Financial institution this spring shone a highlight on federal deposit insurance coverage, which solely extends to $250,000 of a buyer’s cash at a single financial institution. When Giannis Antetokounmpo first discovered of the restrict, he opened half a dozen financial institution accounts to guard his fortune.
The basketball star arrived within the US a decade in the past at age 18, and went to the financial institution to open an account, he advised Bloomberg earlier this yr. “I had no cash rising up, so I requested them, ‘Is my cash secure?'” he recalled. After discovering out concerning the $250,000 cap, Antetokounmpo promptly opened accounts at “5, six, seven” banks.
Marc Lasry, the billionaire co-owner of Antetokounmpo’s group, the Milwaukee Bucks, shared his response to studying of Antetokounmpo’s quite a few financial institution accounts on the Bloomberg Wealth Summit in 2022.
“I am like, ‘Giannis, you’ll be able to’t be having accounts at 50 completely different banks,” Lasry mentioned. “Let me let you know one thing, if JPMorgan goes beneath, your little dinky banks are going to go beneath too. Let me clarify what you should purchase, you should purchase US Treasuries, you should purchase this…'”
Lasry, a distressed-debt investor, famous that Antetokounmpo’s considerations about safeguarding his money doubtless stemmed from his childhood in Greece. The Mediterranean nation suffered a sovereign-debt disaster within the mid-2010s that stoked fears amongst residents that their financial institution deposits might be seized or misplaced.
Lately, Antetokounmpo has acted on the recommendation of Lasry and different trusted advisors. “There’s manner smarter methods to do it, hold your cash secure,” the facility ahead advised Bloomberg, including that he is strategically expanded his portfolio because the pandemic.
Antetokounmpo has loads of cash to guard and deploy. He netted an estimated $81 million in earnings on and off the courtroom in 2022, in keeping with Forbes. The journal ranked him tenth on its record of the world’s highest-paid athletes, after the likes of Lionel Messi ($130 million), LeBron James ($121 million), and Tom Brady ($84 million).
The “Greek Freak” has additionally partnered with Calamos CEO John Koudounis on an exchange-traded fund that invests primarily based on environmental, social, and governance standards.
The Federal Deposit Insurance coverage Corp. (FDIC) took management of SVB and Signature Financial institution this spring after they suffered a wave of withdrawals, and moved to forestall additional financial institution runs by insuring all deposits at each lenders.
Excessive-profile buyers together with Invoice Ackman and Mark Cuban referred to as for the company to briefly scrap its $250,000 cap and insure all financial institution deposits to forestall any additional mass withdrawals and extra financial institution failures.