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New York [US], March 11 One of the most prominent lenders in the world of technology startups Silicon Valley Bank, struggling under the weight of ill-fated decisions and panicked customers, collapsed on Friday, forcing the US federal government to step in, The New York Times reported.The Federal Deposit Insurance Corporation said on Friday that it would take over Silicon Valley Bank, a 40-year-old institution based in Santa Clara, California. The bank's failure is the second-largest in US history, and the largest since the financial crisis of 2008, NYT said.The move put nearly USD 175 billion in customer deposits under the regulator's control. While the swift downfall of the nation's 16th largest bank evoked memories of the global financial panic of a decade and a half ago, it did not immediately touch off fears of widespread destruction in the financial industry or the global economy.Silicon Valley Bank's failure came two days after its emergency moves to handle withdrawal requests and a precipitous decline in the value of its investment holdings shocked Wall Street and depositors, sending its stock careening. The bank, which had USD 209 billion in assets at the end of 2022, had been working with financial advisers until Friday morning to find a buyer, a person with knowledge of the negotiations told NYT.While the woes facing Silicon Valley Bank are unique to it, a financial contagion appeared to spread through parts of the banking sector, prompting Treasury Secretary Janet Yellen to publicly reassure investors that the banking system was resilient.Speaking on the failure of the American lender, Ameya Vikas Ranadive, Equity Research Analyst, Choice Broking, said, "SVB Financials, a bank that mostly finances startups, saw a 60 per cent share price drop, which precipitated the sell-off in American markets. This had an effect on attitudes, and banking stocks declined due to worries that higher interest rates might result in loan payback defaults."Investors dumped stocks of peers of Silicon Valley Bank, including First Republic, Signature Bank and Western Alliance, many of which cater to startup clients and have similar investment portfolios, the daily newspaper said.Trading in shares of at least five banks was halted repeatedly throughout the day as their steep declines triggered stock exchange volatility limits.By comparison, some of the nation's largest banks appeared more insulated from the fallout. After a slump on Thursday, shares of JPMorgan, Wells Fargo and Citigroup all were generally flat on Friday, according to NYT.( With inputs from ANI )Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor

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