As the tech sector shrank back from its highwater mark of the last few years, funds started drying up and the bank with the most exposure, Silicon Valley Bank, found itself with diminishing deposits.
Taking measures to raise equity and liquefy assets, the sentiment around the troubled bank took a turn for the worse, and depositors deserted creating a run on the bank.
The US Federal reserve stepped in to guarantee depositors fearing a general run on banks.
Image: Image: Flickr – Focal Photo
Produced By: Roderick Chambers
Featured In Story: Dr Paul Mazzola Financial Author and Lecturer in banking and finance at the University of Wollongong
First aired on The Wire, Tuesday 14 March 2023