How Silicon Valley Bank Collapsed
The banking panic that shook Wall Street and abused the European banking sector on the…
The banking panic that shook Wall Street and abused the European banking sector on the stock market was right to the preferred bank of San Francisco entrepreneurs . At midday (New York time) on Friday, banking regulator Federal Deposit Insurance Corp shut down Silicon Valley Bank and transferred its deposits to a new special purpose vehicle, the Deposit Insurance National Bank of Santa Clara.
Depositors will only have access to their cash from Monday. They rushed to the counters all Friday morning to withdraw their dollars, panicked after learning that the bank needed funds due to large losses – and urged by some of the Valley’s biggest investment funds to collect their tickets. Suddenly, SVB was unable to honor all withdrawal requests, and this precipitated its collapse.