Depositors holding more than $49 million pulled out of Silicon Valley Bank at a 74% clip before it collapsed in March 2023, draining half the bank’s deposits in six days.
The Federal Deposit Insurance Corp. published “Dissecting Depositor Flight” this week, a transaction-level analysis of the spring 2023 bank failures. SVB, Signature Bank and First Republic all went under in the late winter and early spring of 2023. The FDIC used transaction data to find exactly who ran, and when.
The concentration problem made each institution fragile before the panic even started. SVB’s top depositors held 39% of total deposits; Signature’s held 62%; First Republic’s held 50%. Uninsured deposits made up 94% of SVB’s deposit base and roughly three-quarters at the other two. When the big money moved, there wasn’t much left to hold the line.
Smaller depositors didn’t behave the same way. Those under the $250,000 insurance threshold “generally did not run,” the report found. The flight came from accounts well above that ceiling: top depositor thresholds were $6 million at First Republic, $16 million at Signature, and $49 million at SVB.
Of the top depositors at each bank, 74% ran at SVB, 65% at Signature, and 74% at First Republic. The bulk of the withdrawals happened between March 9 and March 14. FDIC Chair Travis Hill called it “the fastest bank runs in U.S. history.”
— Marcus Webb