Silicon Valley Bank (SVB) has suffered a major fall from grace following half a decade of being rated as one of the best banks in America.
SVB and its parent company SVB Financial Group have been held in high esteem as a financial institution serving a variety of companies across industries, from technology and venture capital firms to private equity clients.
SVB has been included in Forbes’ annual list of the best banks in the U.S for five consecutive years, a point which its parent company had celebrated on Twitter not more than a few weeks prior to its closure under Federal Deposit Insurance Corporation (FDIC) control on March 10.
SVB deleted their twitter account @SVB_Financial
This is what they posted just a few days ago: pic.twitter.com/Tc6EFZhJnn
— Dr. Eli David (@DrEliDavid) March 12, 2023
SVB Financial has since deleted its Twitter account after it was ordered to shut its doors by the California Department of Financial Protection and Innovation.
The fallout had a direct and tumultuous effect on the wider cryptocurrency ecosystem, as stablecoin issuer Circle had $3.3 billion of USD Coin (USDC) reserves tied up in the bank. USDC depegged from its $1 mark as a result but has since clawed its way back to near-parity with its fiat-based peg.
Related: Biden vows to hold accountable those responsible for SVB, Signature collapse
Data from Forbes highlights SVB Financial’s stock price performance over the past five years. $SIVB hovered between highs of ~$325 and $136 between 2018 and the end of 2020. It then hit highs of ~$759 at the tail end of 2021 before a slow and steady decline alongside the wider cryptocurrency and conventional markets.
$SIVB’s share price has since dropped as low as $100 since the closure of SVB in March 2023.
William Quigley, co-founder of Tether, shared insights with Cointelegraph following SVB’s shuttering over the weekend. Quigley is also a former venture capitalist and has over 10 years experience as an auditor of failed banks.
According to Quigley, the U.S. Treasury department has been aware that SVB could not pay all of its depositors back since December 2022 based on federal call reports.
“The Treasury department continued to let SVB operate and take in more depositors cash even as SVB’s fixed asset base continued to drop in value from interest rate hikes.”
Quigley also notes that SVB debt was rated AA by federally regulated statistical rating agency Moody’s while the bank received a clean audit opinion three weeks ago from federally supervised and state licensed auditing firm KPMG.