Arrogance, Incompetence or Both: What SVB’s Failure Really Means

Silicon Valley Bank's failure due to arrogance or incompetence threatens the already fragile US economy as its collapse was a result of becoming too dependent on private equity and venture capital clients.

March 17, 2023 . 1:34 AM

1 min read

Silicon Valley Bank failed due to buying tens of billions of dollars in bonds before interest rates went up, suffering huge losses.
Depositors fled en masse, causing a classic bank run and the bank was seized by regulators.
SVB became too dependent on private equity and venture capital clients, with almost 70% of its outstanding loans dependent on them.
The concentration of assets and liabilities in one group of financiers proved to be SVB's undoing.
SVB's collapse threatens an already fragile economy.