The Federal Reserve said Monday it is launching a review of the supervision and regulation of Silicon Valley Bank, following SVB's rapid collapse.

(Photo: AFP)

US authorities pulled the plug on SVB last Friday, marking America's biggest banking failure since the 2008 financial crisis and raising fears of potential spillovers across the banking system.

The review will be led by Fed Vice Chair for supervision Michael Barr, and this will be released by May 1, the Fed said in a notice.

"The events surrounding Silicon Valley Bank demand a thorough, transparent, and swift review by the Federal Reserve," said Fed Chair Jerome Powell in a statement.

Barr added that there is a need to "conduct a careful and thorough review of how we supervised and regulated this firm."

A run on deposits had made it no longer tenable for the medium-sized bank to stay afloat on its own.