Those customers who remained at SVB have now followed a familiar path in the wake of a meltdown, by simply being shuttled into a new lender courtesy of regulators.
India has done great in regulation because it took time to think things through. The US banking crisis should encourage Modi govt to avoid rush jobs like demonetisation.
The shock of a bank failure is both immediate and long lasting. This kind of situation led to radical solutions in 1826 – essentially a restructuring of UK banking services.
Though RBI has been conservative, such banking crises pose risks to broader Indian economy — potential flight of foreign portfolio capital, pressure on rupee, bad news for stock market.
India can raise the SVB issue with G20 finance ministers and evolve a banking framework to insulate emerging economies of the South from frauds committed by the developed North.
California banking regulators shut down Silicon Valley Bank (SVB) on March 10 after a run on the lender, which had $209 billion in assets at the end of 2022.
On bilateral ties, Admiral Paparo said India-US ties have an exponential effect on deterrence, because it demonstrates a unity of purpose among us to maintain the peace.
This is the game every nation is now learning to play. Some are finding new allies or seeing value among nations where they’d seen marginal interest. The starkest example is India & Europe.
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