Nearly three years after the collapse of Silicon Valley Bank, the urgency of that week in March 2023 has softened. Markets stabilized, regulators intervened, and emergency liquidity programs restored confidence. For many, the crisis now feels like a contained episode rather than an ongoing vulnerability.
But the defining feature of the SVB collapse was not simply duration risk on a securities portfolio. It was concentration. A balance sheet heavily funded by uninsured deposits, clustered within a narrow depositor base, created the conditions for a digital-speed bank run that unfolded in less than 48 hours. Once confidence cracked, large commercial balances moved quickly. When the bank failed, many corporations were faced with potentially huge uninsured deposit losses.
Unfortunately, uninsured deposit risk remains embedded in modern corporate banking. Loan requirements, existing longstanding relationships, and sometimes lack of knowledge drive financial decisionmakers to leave their deposits at risk. This is an unwise, and potentially business-ending decision.
CFO Confidence Is Up, Concentration Risk Persists
Our CFO Cash Confidence research shows that while financial decision-makers report confidence in their primary banking relationship, 41% express concern about the safety of their deposits in the near term, and 53% express concern for long-term deposit safety. A deeper look reveals an even more complicated picture: 86% of respondents carry more than $250,000 at a single bank.
In the immediate aftermath of SVB, many organizations did quickly react, making changes to their corporate cash management strategy. Over time, however, operational simplicity and relationship familiarity have quietly regained influence. Additionally, there are still significantly more uninsured deposits in the banking system than there are dollars in The Deposit Insurance Fund to cover them.
That is particularly concerning when you consider that, on average, businesses report they could continue operating for only 2.9 months if their primary bank failed. This means that many businesses could be one bank failure away from not just losing money, but from closing their doors.
What’s the Solution?
Regulators have spent the past three years debating capital buffers, liquidity requirements, and other reforms. Those efforts matter. But regulation cannot replace the responsibility of corporate financial decisionmakers to properly manage organizational funds. A resilient commercial deposit strategy requires intentional governance. Organizations should understand exactly how much cash sits above insured thresholds and how concentrated those balances are. Cash must be treated as the critical business asset that it is. Just as businesses insure their buildings and equipment, they must protect their cash with the same rigor.
The most underappreciated risk is not hidden losses on a balance sheet. It is complacency among sophisticated depositors who assume their bank’s stability is permanent. The SVB collapse anniversary should not be a retrospective exercise. It should be a governance check.
The lesson of 2023 was not that banks can fail. We already knew that.
The real lesson is whether organizations are finally willing to treat cash as king and protect it accordingly.
