Part 2/10:
Many believed that the banking sector had learned from past crises, noting stricter regulations post-2008 to prevent such failures. The Federal Reserve had stated that the largest 33 banks in the nation possessed enough capital to withstand even severe economic downturns. Yet, recent events suggest otherwise.
SVB’s failure raises questions about whether these assurances hold in practice. Despite oversight, SVB experienced a rapid decline, highlighting vulnerabilities that may exist beneath the surface of supposedly well-regulated financial institutions. The collapse leaves investors and industry analysts worried about the possibility of more failures in the near future.