Third: The negative impact of many technology sectors, especially emerging companies in the field of technology, who are the main customers of Silicon Valley Bank, because the nature of these startups is classified as “high-risk customers” due to their constant needs for cash liquidity and not depositing time deposits, and thus their investors became more risk-averse due to higher financing costs, so the bank’s clients faced a liquidity crunch, and since high interest rates caused the closure of many startups and made raising money more expensive, some of the bank’s clients started withdrawing money to meet their liquidity needs.
In addition to the bank lending a large percentage of the liquidity available in the bank, the bank has the certainty that the depositing customers may accept the withdrawal of deposits resulting from the high-risk nature of the bank’s customers.
