Tremors of collapses of three major banks in the United States have been felt across the world. The shutdown of three banks, the Silvergate bank, the Silicon Valley Bank, and Signature bank in a week caused a widespread outage in the banking sector.
An Indian bank, the Shamrao Vithal Cooperative bank or SVC which had no relation with the Silicon Valley Bank (SVB) faced scrutiny from its customers. The mix-up was caused because of the similarity in the names of both banks, the SVB and SVC. The issue came into focus when the Shamrao Vithal Cooperative bank faced high traffic on its website and some customers started withdrawing their funds.
The SVC took this issue proactively and didn’t hesitate to issue a detailed statement on this issue. In the statement, they have completely disregarded any relationship with the failed bank now managed by Federal Deposit Insurance Corporation (FDIC). It also added that the bank only operates in India and they don’t have any kind of exposure to the United States.
Additionally, the SVC urged its customers to not pay any attention to the rumors and baseless false news currently spreading regarding the potential fallout of SVC. In the same report, the bank mentioned its 116-year legacy, the SVC bank was set up in 1906 and contributed to the upliftment of the urban poor.
This mix-up is the perfect example of how people are worried about their funds. A simple confusion in banking could ultimately affect the banks. For assurance, they have released the net profit earned by the bank to gain the confidence of its customers.
Recently, on 13 March the president of the United States assured American taxpayers that they don’t need to worry about their funds. Every country is on alert mode and has already initiated a process to measure the impact of the collapse of the Silicon Valley Bank on its banking sector.