Silicon Valley Bank, part of the SVB Financial group, was closed on Friday after the United States Federal Reserve raised interest rates, driving away potential investors from the financial institution known for its relations with cutting-edge technology companies and venture capital.
This is the biggest bankruptcy of a US-based financial institution since Washington Mutual collapsed at the height of the financial crisis in 2008.

Here's what to know about why the bank failed, who was most affected, and how it may or may not affect the wider banking system in the US and around the world.

According to Sic Noticias, Silicon Valley Bank was hit by the fall in technology stocks last year, as well as the Federal Reserve's aggressive plan to raise interest rates to combat inflation.

The bank has bought billions of dollars in bonds in recent years, using customer deposits, as most banks do.

These investments are safe, but their value has fallen because they pay lower interest rates than what a comparable bond would pay if it were issued in today's higher interest rate environment.

Sic Notícias also reports that Silicon Valley's clients were largely start-ups and other technology-focused companies that have started to become more cash-strapped over the past year.

Venture capital funding was dwindling; companies couldn't get additional rounds of funding for unprofitable companies and therefore had to use their existing funds - often deposited in Silicon Valley Bank, which was at the center of the tech start-up universe.

So Silicon Valley customers started withdrawing their deposits.

This required the sale of typically safe bonds at a loss, and these losses added up to the point where Silicon Valley Bank effectively became insolvent.

The bank tried to raise additional capital through external investors, but was unable to find them. At first, it wasn't a huge problem, but withdrawals began to require the bank to start selling off its own assets to meet customers' withdrawal requests.

In light of the case, the President of the United States called this Monday for calm and assured that the "financial system is safe".

Joe Biden also promised protection for depositors and shareholders and accountability for managers.

In the UK, the government had to intervene in negotiations to ensure the survival of hundreds of companies in the British technology sector. (Sic Notícias)