As Silicon Valley Bank was wobbling last month, large account holders with balances exceeding the federal deposit insurance limits panicked, sparked a bank run that ultimately prompted the federal government to step in with a rescue plan, and triggered widespread debate about potential reforms to the federal deposit insurance system.
All that drama, however, was at odds with federal data showing that bank failures stretching back to the start of the 2007-2009 global financial crisis have in aggregate done very little harm to uninsured depositors. Less than 7% of the banks that failed since the start of 2007–or 37 out of the 541 bank failures over that period–had uninsured depositors …
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