For about two weeks, global financial markets have been rattled by the news that the US’ 16th largest bank (by deposits), Silicon Valley Bank (SVB), failed on Friday, March 10th.
The news of SVB being taken over by regulators came just five days after the bank had been included in Forbes’ annual ranking of best banks in America for the fifth consecutive year. In fact, some days before (on March 1st), SVB’s CEO, Greg Becker, was quoted as saying, “We pride ourselves on being the best financial partner in the most challenging times” at a summit in Los Angeles.
Life really does come at you fast.
With about $200 billion worth of assets, SVB’s collapse is now the largest failure of a financial institution since Washington Mutual ($307 billion) collapsed at the height of the financial crisis in 2008.
As depositors rushed to get their funds out of the ailing financial institution and concerns about which other banks could potentially kick the bucket heightened, banking stocks worldwide plummeted.