Silicon Valley Bank’s Distress Wasn’t Reflected in Credit Ratings

Ratings firms gave high marks to regional banks shortly before failures

The collapse of Silicon Valley Bank was the second-largest bank failure in U.S. history. Ringo Chiu/Zuma Press

Credit-rating firms held regional banks in high regard—until two of the biggest banking failures in U.S. history.

Rapid collapses at Silicon Valley Bank and Signature Bank cast doubt on whether bondholders will ever be repaid. Uninsured depositors worried they would lose their money before regulators stepped in to guarantee those funds.

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