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Banking Sector Update
Wednesday, March 15, 2023
What happened?
We know that many of you are following the news regarding Silicon Valley Bank (or “SVB”) and Signature Bank. For those that haven’t heard, regulators shuttered both banks and seized deposits after growing concerns of their financial situation. Over the last couple years, those firms were flush with cash and their deposits flourished. However, following the Fed’s aggressive rate increases over the past year, those deposits shrunk at an exponential pace, forcing the banks to liquidate at a significant realized loss.