Publicação
The rise and fall of Silicon Valley Bank: part Il: an angel has fallen
| Resumo: | Inadequate corporate governance and asset-liability management amid the Fed’s aggressive interest rate hikes triggered the third-largest bank failure in U.S. history and rattled the in novation economy. With unprecedented deposit inflows and little loan demand, SVB exten sively invested in long-term bonds, which lost value as rates climbed. Simultaneously, a slowdown in VC activity reduced deposit inflows, while withdrawals by VC-backed com panies increased. Realized losses from forced bond sales and a failed capital raise destabi lized SVB further. The crisis peaked when venture capitalists advised withdrawing funds, triggering a digital bank run that led to a $42 billion outflow in just 48 hours. |
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| Autores principais: | Kotesovec, Raphael Nick |
| Assunto: | Silicon valley bank (Svb) Entrepreneurship Venture capital Venture debt Banking Startups Entrepreneurial finance Bank failure Corporate governance Asset and liability management Liquidity gap Corporate finance Duration mismatch Maturity mismatch |
| Ano: | 2024 |
| País: | Portugal |
| Tipo de documento: | dissertação de mestrado |
| Tipo de acesso: | acesso aberto |
| Instituição associada: | Universidade Nova de Lisboa |
| Idioma: | inglês |
| Origem: | Repositório Institucional da UNL |
| Resumo: | Inadequate corporate governance and asset-liability management amid the Fed’s aggressive interest rate hikes triggered the third-largest bank failure in U.S. history and rattled the in novation economy. With unprecedented deposit inflows and little loan demand, SVB exten sively invested in long-term bonds, which lost value as rates climbed. Simultaneously, a slowdown in VC activity reduced deposit inflows, while withdrawals by VC-backed com panies increased. Realized losses from forced bond sales and a failed capital raise destabi lized SVB further. The crisis peaked when venture capitalists advised withdrawing funds, triggering a digital bank run that led to a $42 billion outflow in just 48 hours. |
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