SVB's collapse completely screwed things up for companies with bad credit
, but one thing is for sure: the chaotic event has made it a lot more expensive for companies with bad credit to raise capital.
The spillover effect of higher fundraising costs is also set to impact countless small startups that relied on Silicon Valley Bank to offer loans and extend lines of credit to companies that lacked profits, and sometimes even revenue. "We are now beginning to see early signs of businesses that built their operating models around the false equilibrium [of near-zero interest rates] begin to struggle," Cunningham said in a Monday note. That's leading to more zombie companies, or companies that rely on low financing costs to fund their business, that could ultimately default.
Australia Latest News, Australia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
SVB collapse: The Treasury must make whole SVB investorsThe Treasury Department is right to ensure that investors at Silicon Valley Bank have access to their deposits.
Read more »
What You Need to Know About the Collapse of SVB and SignatureOver and over again we find this essential truth: Once banking was deregulated, the next crash becomes inevitable.
Read more »
SVB collapse: Here's everything you need to knowFear trickled through the bank sector following the collapses of Silicon Valley Bank and Signature Bank last week, prompting major federal intervention over the weekend to backstop uninsured deposits at Silicon Valley Bank in a bid to halt panic.
Read more »
What regular people need to know about SVB’s sudden closureSilicon Valley Bank made national news as it swiftly collapsed, creating great concern over the billions of dollars it held in deposits. How does SVB’s closure affect you?
Read more »
Q&A: What Central Ohio residents need to know about their money after the SVB collapseDo I got to may bank and pull all my money out?How does the Federal Deposite Insurance Corporation (FDIC) work?
Read more »