Silicon Valley Bank has collapsed, prompted by a bank run in which customers sought to withdraw funds. The implosion of the commercial bank is the largest bank failure since Washington Mutual collapsed in 2008.

The bank’s downfall is partly attributed to the aggressive interest rate hikes by the Federal Reserve over the past year. After years of rates being close to zero, the central bank raised interest rates to control the economy and bring inflation in line, leading to increased borrowing costs for businesses and individuals.

Silicon Valley Bank, despite being relatively unknown outside the tech industry, was the 16th largest American commercial bank with $209 billion in total assets at the end of 2022. The bank was also a significant lender to nearly half of all US venture-backed tech and health care companies.

Following the closure by California regulators, the US Federal Deposit Insurance Corporation (FDIC) has taken over the bank and will oversee the liquidation of its assets to repay customers.

The FDIC has reassured insured depositors that they will have full access to their funds by Monday morning. Those without insurance will be given an “advance dividend within the next week,” according to the agency, CNN reported.

“At the time of closing, the amount of deposits in excess of the insurance limits was undetermined,” the FDIC said. “The amount of uninsured deposits will be determined once the FDIC obtains additional information from the bank and customers.”

The bank’s shares fell by over 60% in pre-market trading, leading to a trading halt. On Thursday, the stock tumbled by the same amount after the bank announced the sale of a portfolio of US Treasuries and shares worth $1.75 billion at a loss to cover declining customer deposits, in what can only be described as a bank run.

Several other bank stocks were also temporarily halted, including First Republic, PacWest Bancorp, and Signature Bank.

SVB’s fall mirrors the exposure of other risky bets during the past year’s market turmoil. Crypto-focused lender Silvergate announced on Wednesday that it would liquidate the bank after being financially pummeled by digital asset turbulence. Signature Bank also experienced a significant selloff, with shares falling by 30% before being halted for volatility on Friday.