What Banks Crashed in 2023: The SVB and Signature Bank Collapse Explained

The banking sector experienced its most shocking moment since the Great Recession when Silicon Valley Bank (SVB) collapsed in March 2023, followed just days later by Signature Bank’s failure. These two back-to-back bank crashes weren’t just newsworthy incidents—they represented a historic turning point that shattered a decade-long stability streak in American banking.

How Rare Were These 2023 Bank Crashes?

To understand why the financial world went into shock, consider this: the U.S. had experienced 867 consecutive days without a single bank failure before SVB’s collapse on March 10, 2023. This was the second-longest drought in U.S. history since 1933. The longest uninterrupted period—nearly three years—occurred from June 2004 through February 2007, right before the financial system imploded.

Between 2015 and 2020, the country averaged fewer than five bank failures annually. More remarkably, not a single bank failed in either 2021 or 2022. Two bank crashes in one year might seem like a warning sign, but it’s actually well below historical averages.

Why Were SVB and Signature Bank Different?

The panic surrounding these bank crashes wasn’t proportional to their frequency—it was proportional to their magnitude.

Silicon Valley Bank was the 16th largest bank in the nation, holding $209 billion in assets as of December 2022. When it collapsed, it became the second-largest bank failure in U.S. history, surpassed only by Washington Mutual’s 2008 collapse (which held $307 billion in assets).

Signature Bank, which failed just 72 hours later on March 13, 2023, held $110 billion in assets, making it the third-largest bank failure ever recorded.

For context, the previous bank to fail before SVB was Almena State Bank in 2020—a tiny regional institution with just $69 million in assets. SVB was roughly 2,000 times larger. Even in 2010, when 157 banks collapsed in a single year (the record since 2000), their combined assets totaled less than half of what SVB alone possessed.

The Broader Historical Pattern

Since 2000, the U.S. has recorded 565 bank failures—roughly 25 per year on average. However, this distribution is wildly uneven:

• 2001-2007: Just 3.57 failures annually during the pre-crisis era
• 2008-2012: A devastating 93 failures per year following the recession declaration in December 2007
• 2010: The worst single year with 157 bank crashes
• Of all 565 failures since 2000, 82% occurred during the 2008-2012 crisis period

The 2023 collapses ended what had become an increasingly rare phenomenon. Regional and smaller banks had become the norm for failures; major national institutions almost never failed.

Geography of Bank Failures

Certain regions proved far more vulnerable to banking sector instability. California, Florida, Georgia, and Illinois dominated the list of states with the most bank failures since 2000.

California led with 42 failures, despite being home to SVB. Georgia and Florida together accounted for 30% of all U.S. bank failures this century, particularly hammered by the 2008-2012 housing and credit crisis. Interestingly, New York—often considered America’s banking capital and home to Signature Bank—experienced only six bank failures since 2000, highlighting how these recent crashes represent unusual departures from regional patterns.

Timing Patterns and Regulatory Strategy

The timing of bank crashes reveals regulatory strategy. 95% of all bank failures since 2000 occurred on Fridays, with only one exception: Signature Bank’s Sunday, March 13, 2023 closure. This Friday timing isn’t coincidental—it allows regulators the entire weekend to manage accounts, liquidate assets, and stabilize operations before customers demand access to their money on Monday morning.

The surprise Sunday shutdown of Signature Bank suggested regulators feared a cascading domino effect. They prioritized stopping panic contagion across the entire banking sector over following standard protocols, indicating how serious the systemic risk had become.

Bank failures also cluster around fiscal quarter boundaries in January, April, July, and October—times when financial stress becomes most apparent in quarterly reviews.

What This Means Going Forward

While 2023’s two major bank crashes sparked widespread concern about a broader financial collapse, they remain statistical anomalies in the modern era. The real significance lies not in frequency but in the exceptional size and systemic interconnection of SVB and Signature Bank to the tech sector and broader financial infrastructure—a factor that distinguished these crashes from the typical small, regional bank failures that have dominated this century’s failure statistics.