Five things to know about the Silicon Valley Bank collapse
By Rebecca Klar and Sylvan Lane
Regulators shut down Silicon Valley Bank on Friday, marking the biggest bank failure since the 2008 recession and sending shockwaves across the tech world. The Federal Insurance Corporation (FDIC) created a National Bank of Santa Clara to hold deposits and other assets of the failed Silicon Valley Bank, but the abrupt closing is impacting tech firms which are facing immediate effects like ensuring employees get paid….The bank was uniquely dependent on the growth of major tech firms and the financial health of the industry at large, which made it highly susceptible to damage from rate hikes. [Silicon Valley Bank’s] balance sheet looks nothing like most US banks’,” wrote Karen Shaw Petrou, managing partner at Federal Financial Analytics, in a Friday tweet. “This isn’t systemic, but it shouldn’t have happened,” Petrou continued.