SVB Financial Group (SIVB.Q), the parent company of Silicon Valley Bank, has had a turbulent few days. Shares fell by more than 60% on Thursday after news emerged that the bank needed to raise capital, and trading was halted Friday after another 60% plunge in premarket activity. While the bank's 52-week high was just shy of $600 per share, it was trading for less than $40 in Friday's premarket session. And now regulators have officially closed the bank.

Here's how SVB went from being a massive success to being shut down by banking regulators, what we know so far, and what might happen next.

SVB Financial's recent news

SVB Financial reported a few major problems to investors recently. The bank sold substantially all of its available-for-sale securities -- $21 billion worth -- at a $1.8 billion loss, mostly in the form of U.S. Treasury securities. In simple terms, SVB received a massive volume of deposits during the 2020-2021 tech boom and invested the proceeds into long-term Treasury bonds while interest rates were low. Now that interest rates are higher, the market value of those Treasuries is substantially lower than SVB paid.

Not only did the bank sell assets at a big loss, but it also said that clients' cash burn rates hadn't slowed down as anticipated in the current economic climate. It said that deposits have been leaving the bank faster than expected this year. In a nutshell, SVB tied too much of its assets up in long-dated Treasuries while being unprepared for the effects of massive outflows in the difficult venture capital environment.

As a result of these losses and the excessive deposit outflows, SVB announced a plan to raise over $2 billion in capital, which would include the sale of $1.25 billion in common stock and $500 million in convertible preferred stock. It also planned to sell $500 of common stock to General Atlantic, an investment firm, contingent on the closing of the $1.25 billion offering to the public.

What happens next?

There's a lot that we don't know about the future of SVB Financial at this point. But here's what we do know.

First and foremost, Silicon Valley Bank has been officially shut down by regulators as of Friday. The Federal Deposit Insurance Corp. (FDIC) confirmed that insured depositors will have access to their money no later than Monday morning. 

SVB Financial was reportedly unsuccessful in raising the capital it needs and has scrapped those plans. And the bank was in talks to sell itself, presumably to a large financial institution. CNBC reported on Friday morning that the bank had hired advisors to explore a sale, but sources said that it could be difficult to assess the value of the bank, as deposit outflows are happening at a rapid pace.

It has also been reported that several notable venture capital funds had advised their portfolio companies to move funds out of SVB. After all, losing access to funds in the event of a bank failure can be devastating for an early-stage start-up.

What we don't know is when a sale will happen, but the FDIC's preferred route is to arrange the sale of insured deposits and other assets to a healthy bank, so it's still very possible. 

Should investors in other bank stocks be worried?

Not only did SVB Financial plunge by more than 60% on Thursday, but the financial sector was the worst-performing part of the market. Phrases like "bank run" and "bank failure" are understandably scaring investors. As of 1:50 p.m. ET Friday, the Financial Select Sector ETF (XLF -0.73%) had fallen by almost 9% this week.

The good news is that most of SVB's issues seem to be very company-specific. SVB is the only major bank willing to lend money backed by illiquid securities, and the company's decision to invest so much of its assets in low-interest mortgage securities wasn't exactly wise. Other banks that lend to early-stage businesses could certainly take a hit, but most banks should be relatively unaffected.

The bottom line is that the SVB Financial situation is still very fluid, and it remains to be seen what could happen with the bank. But there's no reason for investors of other bank stocks to panic. SVB Financial's biggest strength over the past few years -- and now its downfall -- has been that it has a business model that is unique in the banking industry.