Shares in Silicon Valley Bank , a key lender to technology start-ups, plummeted on Thursday as investors moved to withdraw their deposits.Shares in banks have fallen around the world - with the four largest US banks, including JP Morgan and Wells Fargo, losing more than $50bn in market value.In Friday morning trade, shares in Asian banks were also lower.
But more concerningly for the bank, some start-ups who have money deposited have been advised to withdraw funds. "It's crazy how it's just unravelled like this... The interesting thing is that it's the most start-up friendly bank and supported start-ups so much through Covid. Now VCs are telling their portfolio companies to pull their funds," she said.A crucial lender for early-stage businesses, SVB is the banking partner for nearly half of US venture-backed technology and healthcare companies that listed on stock markets last year.
Banks tend to hold large portfolios of bonds and as a result are sitting on significant potential losses. The falls in the value of bonds held by banks is not necessarily a problem unless they are forced to sell them.
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