In short, SVB encountered a classic run on the bank. The longer version is a bit more complicated. Several forces collided to take down the banker. First, there was the Federal Reserve, which began raising interest rates a year ago to tame inflation. The Fed moved aggressively, and higher borrowing costs sapped the momentum of tech stocks that had benefited SVB. Higher interest rates also eroded the value of long-term bonds that SVB and other banks gobbled up during the era of ultra-low, near-zero interest rates. SVB's $21 billion bond portfolio was yielding an average of 1.79% — the current 10-year Treasury yield is about 3.9%. At the same time, venture capital began drying up, forcing startups to draw down funds held by SVB. So the bank was sitting on a mountain of unrealized losses in bonds just as the pace of customer withdrawals was escalating.