It might have been an error for the California Bank regulators to put SVB into receivership. Apparently the bank was illiquid but not insolvent. ANY bank can become illiquid due to a run on the bank.
It’s scary that SVB went belly up because it invested in Mortgage Backed Securities. The Fed has been one of the largest buyers of MBS over the past ten years.
In January they started thinking they might want to start selling them.
If they had to “mark to market” it would be a very bad thing.