US banks rethink social media as a threat, not a marketing tool

Bankers are beefing up risk management, monitoring and emergency procedures around the use of social media after an internet-fueled run toppled Silicon Valley Bank two months ago and sparked turmoil in the industry.

In board rooms across the United States, executives are devising programmes and plans to counteract online threats including rumors around the health of the banks that could lead to deposit outflows or weigh on the stock, according to seven banking industry executives and analysts.

The efforts, which have not been previously reported, underscore banks’ urgent efforts to adapt to changing times, prevent depositors from sparking a bank run or stop online attacks on their shares by short sellers.