[16] Citing inadequate liquidity and insolvency, state officials at the DFPI appointed the Federal Deposit Insurance Corporation (FDIC) receiver of the bank.

[26][27][2][28] They hired Roger V. Smith, who had previously headed a high-tech lending unit at Wells Fargo, to be the bank's first CEO and president.

[29] The bank launched on October 17, 1983, as a wholly owned subsidiary of Silicon Valley Bancshares (now SVB Financial Group).

[1][2] It lined up 100 initial investors, including NFL quarterback Jim Plunkett, and well-connected former U.S. representative Pete McCloskey joined its board to give the bank credibility with the venture capital community.

The bank structured its loans with the understanding that startups do not earn revenue immediately, managing risk based on their business model.

Under Smith's leadership, the bank diversified into the high-risk real estate loan business, which amounted to 50% of its portfolio by the early 1990s.

A slump in the California real estate market resulted in a $2.2 million loss for the bank in 1992, and by 1995 the portfolio percentage had fallen to 10%.

[37] The wave of computer technology startups during the dot-com bubble provided an influx of business for the bank, which was noted for its willingness to lend to venture-stage companies that were not yet profitable.

[39] SVB formally entered the private banking business in 2002, building on prior experience and relationships with wealthy venture capitalists and entrepreneurs.

[45] SVB also managed two local yuan-denominated funds for Shanghai's Yangpu District government, and invested in a Hangzhou-based loan guarantee company.

[48] The bank's customers were primarily businesses and people in the technology, life science, healthcare, private equity, venture capital and premium wine industries.

[7][49][50] According to the Federal Reserve, the bank’s client base has been heavily concentrated in venture capital-backed (VC-backed) and early-stage start-up firms, with an emphasis on emerging entrepreneurs and investors.

[57][58] The bank’s underlying profit model has also been described as a “high interest margin” strategy based on credit support for VC firms in need of liquidity.

[68][69] As a legacy of its Boston Private acquisition, it provided free banking services to many nonprofit organizations in San Mateo County, California.

[70] In 2022, SVB began to incur steep losses following increased interest rates and a major downturn in growth in the tech industry, with the bank heavily concentrated in long-term Treasury bonds.

[73][74] Use of social media was reported to be a factor in both the initial bank run and its aftermath, with those affected by the potential loss of deposits calling for regulators to ensure that uninsured accounts were made whole.

[75][76][77][78] Early in the morning of March 10, examiners from the Federal Reserve and the FDIC arrived at the offices of SVB to assess the company's finances.

[79] Several hours later, the California Department of Financial Protection and Innovation (DFPI) seized SVB[80] citing inadequate liquidity and insolvency,[81] and appointed the FDIC as receiver.

The FDIC added that SVB’s official checks would clear and that loan customers should continue making payments, and clarified that their role was not to protect Silicon Valley Bank shareholders and certain unsecured debt holders.

[100][101][102] On March 17, 2023, Silicon Valley Bank's former parent company, SVB Financial Group, filed for Chapter 11 bankruptcy.

The New York Times described it as "a rare instance of overt self-criticism from the Fed, and it comes as the aftershocks of Silicon Valley Bank’s collapse continue to shake the American financial system.