The failure of the Silicon Valley Bank (SVB) has rattled markets in the U.S. and raised fears that other banks could follow suit. While the effects in Asia have so far been minimal, the high-profile collapse nonetheless raises questions about the health of South Korea’s own banking system.

SVB was a medium-sized bank by U.S. standards, and its collapse had a limited direct impact on South Korean investors. SVB collapsed due to distinctive investment strategies and rising interest rates. 

But other banks, including those in South Korea, may also be vulnerable given persistent inflation and potential further interest rate increases.