Silicon Valley Bank's abrupt collapse last month has brought the fragility of smaller banks' financial structures under scrutiny. While the nation’s biggest banks continue to prosper,citing "a deterioration in the operating environment and funding conditions," Moody's downgraded the ratings of 11 regional banks. Smaller banks are seen as more at risk, with deposits falling and the cost of keeping customers rising, eating into profits. In response to concerns, banking regulators are pushing to tighten rules on the industry.

It has hit the technology industry particularly hard, with clients exiting regional banks and deposit rates falling by 1% on average for midsize banks that have reported first-quarter earnings. Although Silicon Valley Bank's collapse didn't lead to widespread runs on deposits, the perception of the safety of larger institutions has led a number of savers to withdraw investments from smaller banks. Despite these losses, executives consider the disruptions to be manageable.