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  1. But but you told me it was just a liquidity issue not a hole in their balance sheet!
  2. Eh, the AT1s based in Swiss law were very explicit on ability to wipe out these bonds above equity. Too bad people didn't read the fine print.
  3. On the totally making shit up at this point scale, I think the political blow back of "saving" SVB has made it impossible to save First Republic. The FDIC has to let it fail.
  4. We use keeper security but have a big team (40+ people). Previously, we used 1password which I like better but unmanageable with a bigger team.
  5. Yes, decade(s) before.
  6. This is a nice soundbite but does not hold water as private schools, grad especially MBAs, law, etc has seen similar price increases as undergrad. The price of education is almost unrelated to holds the loan risk. It is the driven by the decades of public funding cuts to higher education so cost transfer has occurred from a public good to a private one.
  7. It was the definitive nature of the original post is my issue. I believe where we fundamentally disagree is impact on mark to market. Very few people are looking at company financials much less are customers. There is a reason that regional banks are overwhelming impacted by this issue while GSIBs are not.
  8. Not a banking regulation expert so going to mishmash my wording due to the lack of mark to market that the bank did not have the recognize the loses on the loans until they sold the treasuries. As a result, the capital reserve lose was recognized all at once when they sold the treasuries vs GSIBs who have had to continual mark their books to market resulting in hedging and managing their capital reserve. You see this with JPM who came out months ago saying they would not touch long date treasuries with a 10 foot pole because it was clear that interest rates would rise causing loses on these investments having to be realized. The regional banks did not have to realize these loses because of mark to market rules and were forced to sell because deposit draw down was accelerating. Because SVB deposit base was shrinking so fast (mostly VC money being lite on fire by tech) and lack of new funding from VCs into the ecosystem, SVB had to shore up its capital reserve. The only way to do that was sell its loan book. If SVB had to mark to market, they would had to months ago change their capital reserve sooner and not all at once. Arguably if they had to mark to market and loses were born over time instead all at once, you would not have had the mass panic causing the capital flight. Lots of mistakes were made including how GS handled the equity raise which was comically bad. That does not change the situation where mark to market could have prevented the situation. I don't have the specifics on liquidity but understood that is related but not wholly dependent on mark to market on loan portfolio to test ability to sell assets on reasonable prices to test if a bank can handle reasonably extreme market movements.
  9. Not a defense of SVB, but no regional bank could withstand $54b? in withdrawls so there is merit to the run of the bank argument. With that said, it does not mean the bank was mismanaged and potentially insolvent which is seen in no other bank wanting to buy their assets. Every bank even GS wanted to own SVB but not one of them is willing to acquire their (toxic) assets because as you look into their loan portfolio then you quickly discover how quickly the bank is under water as it was essentially run as a leveraged PE fund.
  10. This is categorically untrue. Globally systematically important banks have to mark their portfolio to market and have liquidity requirements that SVB and other regional banks who have assets under $250b do not. The liquidity requirements alone would have triggered a change in their portfolio approach. Additionally, it would not allowed them to be surprised by loses on long dated treasury as those loses were only realized when sold vs GSIBs have to make their portfolio to market.
  11. Every national retailer wants a banking licenses but blocked due to political reasons. Let retails (e.g., Amazon/Walmart) buy these regional banks.
  12. it changed the threshold from $50b in assets to $250b this was predictable and comical how the regulators have backed themselves into this corner.
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