Silicon Valley Bank Collapse: Another big bank collapses, biggest crisis after 2008, SVB shut down; Know the whole matter

Silicon Valley Bank Collapse: Because of this startup-focussed SVB Financial Group, we are witnessing the biggest bank failure since 2008. This bank was shut down by US regulators on Friday.

Silicon Valley Bank Collapse: Last week, Silicon Valley Bank created a stir in the American markets. After the sinking of the banking company Washington Mutual during the economic crisis of 2008, it is now being considered as the biggest economic crisis. Due to this SVB Financial Group focusing on startup, we are seeing the biggest bank failure since 2008. This bank was closed by the US regulators on Friday. Banking regulators in California have closed the bank and appointed the Federal Deposit Insurance Corporation (FDIC) as receiver of its assets.

Customers will get insurance money but...

According to a Reuters report, the FDIC has said that all offices of Silicon Valley Bank will open on March 13 and insured depositors will get their insurance money. But it is known that by the end of the year 2022, out of the bank's $ 175 billion deposits, 89% of the deposits were not insured.

The merger of another bank in SVB is being discussed

The report quoted a source as saying that the FDIC is trying to persuade a bank to merge with Silicon Valley Bank before Monday. With this, unsecured deposits will be protected, although such a deal is not yet visible.

What is the whole matter? (Silicon Valley Bank Crisis)

Silicon Valley Bank was the 16th largest bank in America. It had total assets of $209 billion and $175.4 billion in deposits. This bank was a big support for venture capital companies. It had a big share in the tech industry. Investors have become more cautious amidst rising interest rates in the US, according to information, many of the bank's clients had started withdrawing their money, so that they could meet their liquidity requirements. In such a situation, the bank had announced to raise $ 1.75 billion fund this week to strengthen its capital position, after which questions were raised about its financial health. Shares of SVB Financial Group, the parent company of this bank, had fallen by 70%, after which trading in it was stopped on Nasdaq.