Abv.vg.svb 〈Real — 2024〉
: Borrowers often pledged all assets as collateral and were required to maintain all cash deposits exclusively with SVB.
: As startups raised massive rounds of equity (venture growth), they deposited the proceeds into SVB. SVB then used these deposits to provide loans back to the same ecosystem. The SVB Crisis: A Collision of Risks ABV.vg.svb
: To cover these withdrawals, SVB was forced to sell securities at a loss, which spooked investors and triggered a massive bank run of $42 billion in a single day. Technical Perspective: Singular Value Decomposition (SVD) : Borrowers often pledged all assets as collateral
: As the Federal Reserve increased interest rates, the value of SVB's fixed-rate bond portfolio dropped. ABV.vg.svb