How Silicon Valley Bank Collapse Impacted A 116-Year-Old Indian Bank
By Abhi Singhwww.balakvalue.inImage Credit: Google
Silicon Valley Bank (SVB), a US-based bank that catered to tech startups, collapsed in March 2020.
Image Credit: Google
Image Credit: Google
The collapse of SVB had a ripple effect on its clients, including India's 116-year-old Karur Vysya Bank (KVB).
Image Credit: Google
Image Credit: Google
KVB had invested around $6.5 million in SVB, which accounted for a significant portion of its capital.
Image Credit: Google
Image Credit: Google
The collapse of SVB led to a significant erosion of KVB's capital and caused its stock prices to plummet.
Image Credit: Google
Image Credit: Google
The Reserve Bank of India (RBI) had to intervene to prevent the collapse of KVB and put it under a moratorium.
Image Credit: Google
Image Credit: Google
The RBI then orchestrated a merger between KVB and the private sector lender IndusInd Bank.
Image Credit: Google
Image Credit: Google
The merger helped KVB to survive the crisis, but it also led to job losses and operational changes for its employees.
Image Credit: Google
Image Credit: Google
The collapse of SVB and its impact on KVB highlight the interconnectedness of the global banking system and the risks involved in investing in niche financial institutions.