After US regulators closed down Silicon Valley Bank (SVB) on Friday, Elon Musk expressed interest in purchasing the collapsed bank and transforming it into a digital bank.
Also Read: Business updates: Apple, Foxconn get Karnataka to bend labour laws
The billionaire entrepreneur had previously acquired Twitter and expressed interest in incorporating payments into the platform. His response to a tweet suggesting Twitter purchase SVB has sparked speculation about his intentions.
I’m open to the idea
— Elon Musk (@elonmusk) March 11, 2023
SVB was the 16th largest US bank by assets, with $209 billion in assets and $175.4 billion in deposits as of the end of 2022, and primarily provided financing for startups.
On Friday, Silicon Valley Bank (SVB) collapsed after a dramatic 48 hours, becoming the second-largest bank failure since the 2008 financial crisis. According to a report by the news agency AP, the bank mainly served technology professionals and venture capital-backed firms, including several well-known brands in the industry.
Also Read: FTC probes Twitter data practices after Elon Musk’s layoffs
SVB, which was primarily focused on providing financing to startups, had grown to become the 16th largest US bank by assets, with $209 billion in assets and around $175.4 billion in deposits as of the end of 2022.
The collapse of Silicon Valley Bank is not only the second-largest retail bank failure in US history, but it’s also the largest bank failure since Washington Mutual in 2008, causing market jitters.
Also Read: Elon Musk vs Halli: Here’s what happened on Twitter
The bank’s troubles began when customers withdrew their funds, leading to the liquidation of securities positions whose values had declined due to the Federal Reserve’s interest rate hikes, ultimately resulting in its rapid downfall.
The abrupt rise in interest rates caused the securities purchased by SVB to be sold for substantially lower prices.