The collapse of Silicon Valley Bank is causing global contagion, with some impact on the sentiment of the market in the short term and long term. However, the Indian banking system is more insulated and regulated, and the Indian equity markets are unlikely to be impacted. However, after Adani’s collapse due to Hindenburg Research report, the investor are losing confidence in the market and banks. Reportedly, the SVB collapse led to a confusion and a Pune based cooperating bank, Shamrao Vitthal bank became the victim of SVB collapse.
On Monday, Shamrao Vitthal Bank had a long queue of its customers even before the bank opening time. Reportedly, the customers queued up to withdraw their hard earned money before the bank goes totally default. Bank manager clarified that the bank that collapsed is a different SVB and has nothing to do with India. “That is Silicon Valley Bank in USA, yours is Shamrao Vitthal Bank in USA i.e. Ullhasnagar Sindhi Association. Both are totally different” told the manager to the people.
However, one customer didn’t get convinced and broke his Rs 50,000 before its maturity and posted this on society Whatsapp group asking other Shamrao Vitthal Bank customers also to withdraw their money before they lose it like investors did in Adani case.