Journal of
Italian
Banking
Association

year 100
 

Archive » April 2024 » The Silicon Valley Bank case: a critical analysis of the crisis factors under the point of view of interest rate risk

The Silicon Valley Bank case: a critical analysis of the crisis factors under the point of view of interest rate risk

Giuseppe Cicardo
April 2024 - n. 4
Keywords: Silicon Valley Bank, crisi bancarie, rischio di tasso di interesse
Jel codes: G21, G28

The article reviews the crisis of Silicon Valley Bank and the tensions that characterized the banking sector of the United States in the first half of 2023 to highlight its systemic character and its source, identifying the latter in interest rate risk as a characteristic element of the activity of banking intermediation. In the case in question, other elements contributed to the crisis, such as a flight of customer deposits of greater proportions than those experienced in 2008-2009, as well as insufficiently stringent accounting and prudential rules as well as corporate governance and supervisory conducts that were not particularly rigorous. However, interest rate risk and the limits in the related management and control methods were the driving factors in the same way as other systematic risks (credit risk and liquidity risk) were in past events of bank crises.

Interested in this paper?
Buy the issue