Silicon Valley Bank collapsed on Friday and was taken over by federal regulators, marking one of the largest lender failures since the 2008 Financial Crisis. Here's what to know about SVB.
A customer stands outside of the shuttered Silicon Valley Bank headquarters in Santa Clara, Calif., on March 10, 2023. The lender was taken over federal regulators on Friday, marking one of the largest bank failures since the 2008 Global Financial Crisis.A customer stands outside of the shuttered Silicon Valley Bank headquarters in Santa Clara, Calif., on March 10, 2023.
It was a collapse that sent shockwaves across the banking industry, hammering shares of other smaller and regional lenders.Although it was not in the same league as, say, Goldman Sachs or J.P. Morgan Chase, Silicon Valley Bank, or SVB, punched above its weight during its 40-year history. But in recent months, many of Silicon Valley Bank's clients had been withdrawing money at a time when the tech sector as a whole has been suffering.
That led to a major slump in SVB's shares. The bank's stock price fell by 60% on Thursday, and as its share price continued to sink overnight.Traders working at the New York Stock Exchange on March 10, 2023 in New York City. Shares of Silicon Valley Bank slumped before it was taken over by the FDIC.Traders working at the New York Stock Exchange on March 10, 2023 in New York City. Shares of Silicon Valley Bank slumped before it was taken over by the FDIC.
Bank analysts at Morgan Stanley said in a note"the funding pressures facing" Silicon Valley Bank"are highly idiosyncratic and should not be viewed as a read-across to other regional banks."
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