The main difference between the two banks is that Silicon Valley Bank’s debt was in securities, while First Republic’s was in loans
Posted on 03/12/2023 8:05:24 AM PDT by RoosterRedux
Higher than 25%?
To my eye, it does not look like Silicon Valley Bank did anything seriously wrong.
I mean, if more than 25% of your depositors show up on the same day and demand their money, EVERY bank is a candidate for insolvency!
In retrospect, SVB did make a mistake buying long term bond reserves at historically low interest rates.
When rates began to rise because of inflation, the cash re-sale price of their bond reserves dropped around 10%, and perhaps even more than 10% on bonds they did not try to sell for cash.
Regardless, so far, I cannot see any specific problem that caused SVB to fail - except depositor panic!
Yep....am seeing people line up at Atms over the weeken at “other” banks too.
“We’re calling it a ‘Bail-In’. See, I promised no bail-out!”
The main difference between the two banks is that Silicon Valley Bank’s debt was in securities, while First Republic’s was in loans
Is she trying to help Meghan and Harry? We have read that Harry’s money from Waaaugh was being deposited at SVB. Anyone dumb enough to deposit their money in a bank that doesn’t employ real actuaries does not deserve to be bailed out.
The bank, founded in San Francisco in 1985, has 80 branches in 11 states nationwide - mainly on the West and East coasts.
That girl is a survivor, and Harry is yesterday's news!
If some of the persons banking at SVB had less than $250k in deposits within the bank, they would still need access to the funding, which is why they physically showed-up as they do not have the option to wait for the government to reimburse that money. ......which can take up to 30 yrs I understand.....So That is what we are seeing - it’s not someone liaising with a personal banker or, transferring funds electronically, these are people genuinely afraid their money is gone.
I did not realize that banks separated bonds on their balance sheet like that.
I need to read the entire essay again this evening.
I may have more comments then.
Thanks again - terrific financial website!
Not seeing anything like that here.
Most seem ignorant of what’s going on.
Typical.
yeah ... it should probably be its own thread ...
"It's too big to fail, we must act." "The problem is much greater than we previously determined."
We will hear government speak ad nauseam from the govt. stooges and the MSM.
It is my understanding about 90+% of this banks deposits exceed FDIC $250,000 insurance - if correct, the question should be asked: who exactly would it be Brandon is bailing out with Chinese backed US debt in this Liberal bank in the heart of west coast liberalism?
Bull. The millionaires will always get bailed out. Happens. Every. Time.
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