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Takeaways From Silicon Valley Bank’s Collapse
By The Good Investors  •  June 9, 2023
March 2023 was a tumultuous month in the world of finance. On 8 March, Silicon Valley Bank, the 16th largest bank in the USA with US$209 billion in assets at the end of 2022, reported that it would incur a US$1.8 billion loss after it sold some of its assets to meet deposit withdrawals. Just two days later, on 10 March, banking regulators seized control of the bank, marking its effective collapse. It turned out that Silicon Valley Bank, or SVB, had faced US$42 billion in deposit withdrawals, representing nearly a quarter of its deposit base at the end of 2022, in just one day on 9 March. SVB had failed because of a classic bank run. At a simplified level, banking involves taking in deposits and distributing the capital as loans to borrowers. A bank’s assets (what it owns) are the loans it has doled out, and its...
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By The Good Investors
We are Chong Ser Jing and Jeremy Chia, and we started The Good Investors in the aftermath of The Motley Fool Singapore’s closure in late 2019. We both have a passion for stock market investing and believe deeply in enriching society through our investing activities. One way we can do so is through investor-education. The Good Investors is our personal investing blog and will serve as a free platform for both of us to openly share our investing thoughts with you.
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