Silicon Valley Bank Collapses: Biggest US Bank Failure Since 2008

Silicon Valley Bank, one of tech’s favorite lenders, has collapsed after 48 hours of chaos, becoming the second-largest bank failure in US history. On Friday, the Federal Deposit Insurance Corporation shut down the bank and seized its assets.[0] This is the biggest failure of a US bank since the financial crisis in 2008 and it has sent anxiety across the financial system and shaken the tech industry.

The FDIC is now acting as a receiver for the bank, liquidating its assets to pay back customers and creditors.[1] Customers may access their insured deposits on Monday, but FDIC insurance only covers deposits up to $250,000.[2] Many Silicon Valley startups had more than that in their accounts, leaving them in a bind.

The collapse of the bank is due in part to the plunge in the value of bonds it acquired during boom times, when it had a lot of customer deposits coming in and needed somewhere to park the cash.[3] The bank sold part of its bond holdings at a steep loss of $1.8 billion to compensate for withdrawals.[4]

President Joe Biden and other political figures have emphasized that “no losses will be borne by the taxpayers” related to the government’s intervention for Silicon Valley Bank.[5] But some are skeptical of that statement, including Democratic Sen. Elizabeth Warren of Massachusetts.[6]

As of December 31, 2022, Silicon Valley Bank had approximately $209.0 billion in total assets and about $174.5 billion in total deposits, according to the FDIC.[7] All insured depositors will have full access to their insured deposits no later than Monday, and the FDIC will pay uninsured depositors an “advance dividend within the next week.”[8] Ultimately, the failure of Silicon Valley Bank highlights the widening gap between the value of large lenders and what they’re actually worth in the market, and it serves as a reminder of the fragility of the banking sector.[3]

0. “Bernie Sanders blames Trump-era policy for Silicon Valley Bank run” Business Insider, 13 Mar. 2023,

1. “Yellen rules out bailout for Silicon Valley Bank: “We’re not going to do that again”” CBS News, 12 Mar. 2023,

2. “Is my money safe? How secure is the banking system? Your Silicon Valley Bank fallout questions, answered” CNN, 13 Mar. 2023,

3. “US banks sitting on unrealized losses of $620 billion” CNN, 12 Mar. 2023,

4. “What to know about the spectacular collapse of Silicon Valley Bank” NPR, 10 Mar. 2023,

5. “With Silicon Valley Bank depositors protected, let the bailout debate begin” Axios, 13 Mar. 2023,

6. “The tech industry avoided an ‘extinction-level event,’ but it’s not unscathed” CNN, 13 Mar. 2023,

7. “PR-16-2023 3/10/2023” FDIC, 12 Mar. 2023,

8. “Mark Cuban urges Fed to buy Silicon Valley Bank debt ‘immediately,’ says it’s ‘not the wealthy taking the hit’” Fortune, 11 Mar. 2023,

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