Lenders face a lot of risks, but two of them – interest rate and liquidity – were the main drivers of the sudden and rapid failure of Silicon Valley Bank and Signature Bank. That’s why more trouble may be ahead for the banking sector.
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SVB, as it’s known, collapsed with lightning speed following a run on its deposits.
I graphed the average online rate for a $10,000 deposit against the Reserve Bank’s cash rate, going back to 2010. After seeing what that graph reveals, you’ll want to call your bank.
