Financial risk. Coins falling and Warning label on whitebackgrou


Bank stocks were crushed on Thursday after implosions at Silicon Valley Bank and Silvergate Capital sent “shock waves” through the rest of the sector.

Mega-cap banks like JPMorganBank of America, and Wells Fargo all fell more than 5%, while the regional banking sector sank by as much as 8%. The decline picked up steam throughout the trading day as shares of SVB Financial plunged as much as 62%. The KBW Bank Index fell 7.7%, its biggest decline since June 2020.

The implosion at SVB Financial happened after the company lowered its guidance, announced a $2.3 billion capital raise, and said it lost $1.8 billion as it sold off more than $20 billion worth of US Treasuries that it bought when interest rates were near record lows. The multi-pronged announcement caught investors by surprise.

“Part of the problem is Silicon Valley [Bank] had been telling investors up until a couple weeks ago that their guidance was intact. There was no reason to believe this announcement was going to hit,” Keefe, Bruyette & Woods’ head of equity trading RJ Grant told Insider on Thursday.

The full post is here.

Now read this: “Silicon Valley Bank’s liquidity crisis rocks the tech world“.

This: “SVB Financial’s attempts to raise capital failed; in talks for sale – report

And this: “FDIC takes control of Silicon Valley Bank“.

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