Silicon Valley Bank, which partnered with nearly half of the venture-backed tech and healthcare companies, collapsed March 10, CNN reported.
The event marked the biggest failure of a bank since the 2008 financial crisis and the second largest in U.S. history, according to the story. Silicon Valley Bank, which had $209 billion in assets at the end of last year, has invested heavily in digital health, an industry that has seen its funding dry up amid rising interest rates and declining venture capital.
Regulators from the state of California shut down the bank after it failed to raise enough capital to keep running, ceding control to the Federal Deposit Insurance Corp., the news outlet reported. The bank didn’t respond to CNN’s request for comment.
“Now that the bank has folded, I just want to know what happens next,” Ashley Tyrner, founder of health food delivery company FarmboxRx, told CNN in an email. “The FDIC covers 250K, but am I going to recover my whole 8 figures?”
Mike Mayo, Wells Fargo senior banking analyst, told the news outlet the failure may be “an idiosyncratic situation.”
“This is night and day versus the global financial crisis from 15 years ago,” he said, when “banks were taking excessive risks, and people thought everything was fine. Now everyone’s concerned, but underneath the surface the banks are more resilient than they’ve been in a generation.”