INFOGRAPHIC: A timeline of Silicon Valley Bank's collapse
A week ago today, Silicon Valley Bank, the 16th biggest bank in the U.S. and a long-time prominent lender in the startup ecosystem collapsed, in what is the largest financial institution collapse in the United States since Washington Mutual went under in 2008.
For decades, SVB took deposits from clients including high-flying tech startups and invested them in generally safe securities, like bonds. After the Federal Reserve increased interest rates, these bonds that were consistent and secure became worthless.
This wouldn’t have been an issue, but the broader macroeconomic crisis in the venture capital and tech industry caused deposit inflow to slow down, and clients started withdrawing their money.
Emmanuel Oyedeji
As a result, SVB was forced to sell part of its bond holdings at a loss of $1.8 billion. This move spooked clients' companies and sent company leaders pulling their money out of the bank frantically which led to a bank run. The bank was eventually taken over by the Federal Deposit Insurance Corporation (FDIC) on Friday.
By Sunday, March 12, the Biden administration had subsequently swept in to save the day by announcing that all depositors would have access to all their money from Monday, March 13.
However, before the 11th-hour crisis manoeuvres from Washington, there were concerns about whether companies across the world with funds held up in the bank would be able to get their money back and pay their employees.
This Techloy infographic shows a brief timeline of the Silicon Valley Bank collapse between March 10 and March 17, 2023.
