Advances in Economics, Management and Political Sciences
- The Open Access Proceedings Series for Conferences
Proceedings of the 2nd International Conference on Financial Technology and Business Analysis
Series Vol. 57 , 05 January 2024
Open
Access | Article
The Reason for Silicon Valley Bank Collapse and Relevant Suggestion
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Abstract
Against this background, the primary objective of this study is to analyse the variables and underlying causes that contribute to the potential collapse of Silicon Valley Bank (SVB). Based on extensive research and analysis, the internal structure of SVB reveals that several key causes have contributed to the company's bankruptcy. These elements include the adverse economic conditions, the impact of the pandemic, government policies, and internal management issues inside SVB. The findings of the research underscore the impact of the prevailing economic downturn and the decision of the United States government to raise interest rates on SVB, a financial institution with a singular portfolio. Consequently, SVB is compelled to address the dearth of capital by consistently liquidating its assets. The failure of SVB Bank can be attributed to its tight association with the financial market and the overall state of the economy. The potential collapse of a financial institution might exert adverse effects on the overall stability of the financial market. Hence, it is contended that organisations should pursue portfolio diversification, enhance their liquidity management, and safeguard their cash-based assets in order to mitigate risk diversification.
Keywords
Silicon Valley Bank, bankruptcy, management problem, economic recession, Covid-19 pandemic
References
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Data Availability
The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.
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- Volume Title
- Proceedings of the 2nd International Conference on Financial Technology and Business Analysis
- ISBN (Print)
- 978-1-83558-205-3
- ISBN (Online)
- 978-1-83558-206-0
- Published Date
- 05 January 2024
- Series
- Advances in Economics, Management and Political Sciences
- ISSN (Print)
- 2754-1169
- ISSN (Online)
- 2754-1177
- DOI
- 10.54254/2754-1169/57/20230540
- Copyright
- 05 January 2024
- Open Access
- This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited