Silicon Valley Bank’s failure in March 2023 was a watershed moment for the banking sector. The $210 billion collapse was the third-biggest in American history, sending shockwaves throughout the industry and exposing the solvency issues created by rising interest rates.
Columbia finance professor Tomasz Piskorski is one of the leading experts in surveying the post-SVB landscape, as one of the co-authors of a widely read 2023 study estimating a $2 trillion decline in banks' asset values after the monetary tightening of the previous year. At the Fortune Future of Finance conference in New York City, Piskorski said the long-term consequence of higher-for-longer interest rates and new regulations will mean banks becoming less central to the financial system, as private credit and nonbank mortgage lenders such as Rocket Mortgage pick up the slack.
