Justin Sullivan
What a week for the equity markets, and banks in particular! On Friday, due to a sudden increase in deposit outflows and a failed attempt to raise equity, Silicon Valley Bank (NASDAQ:SIVB) was shut down by US regulators — marking the largest bank failure since the financial crisis (by far).
As a consequence, I have received quite a few messages from concerned readers about their investments in bank stocks. Thus, I would love to quickly explain as simple as possible what I believe caused the collapse of SVB Financial. And similarly, why I agree with Janet Yellen’s assessment that the banking system is fine – for now.
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