Run on US bank sparks fears over interest rate risk
Major banks’ shares drop as investors reassess billions of dollars of unrealised losses
A run on a US bank has triggered a wider reassessment of the billions of dollars of unrealised losses on banks’ government bond holdings.
Shares in Silicon Valley Bank (SVB) plunged 60% on March 9, after the lender admitted to making a $1.8 billion loss on securities it sold to cover deposit withdrawals. Today (March 10), regulators declared the firm insolvent and placed it into receivership.
SVB had taken an even larger unrealised loss, as much as $15 billion, on long-dated bonds that have
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