4 ms·

A systematically important bank. They are subject to the most regulation (small, regional, and credit unions lobbied for looser rules) and have an implicit gove

A systematically important bank. They are subject to the most regulation (small, regional, and credit unions lobbied for looser rules) and have an implicit government backstop. The top 3 are JPM-Chase, BoA, and Citi.

bank-error 4y ago
[flagged]
- yunohn 4y ago
  > None of these banks will accept a risky startup placing assets They won’t let you deposit money? Why?
- biztos 4y ago
  What does “placing assets” mean here? If I walk in to Citi and say “I have ten million bucks and will need to withdraw them half a million per month” are they really not going to take my deposit? I get that they might not want to loan me money, but the SVB problem everyone’s worried about is losing their deposits, or do I have that wrong?
  - oefrha 4y ago
    > If I walk in to Citi and say “I have ten million bucks and will need to withdraw them half a million per month” are they really not going to take my deposit? They will take your deposit, and the banker will even get a nice fat bonus for bringing in big cash deposits (well maybe not a fat one for a meager $10m). Gp doesn’t know what they’re talking about.
- oefrha 4y ago
  Maybe instead of avoiding questions in replies and adding an “Edit” merely to trade insults, you can educate us on why JPM Chase won’t accept cash deposits from startups, and we can learn something. However I’m not holding my breath for insights when startup cash deposits and subprime mortgages are “similar” “bad risks” to you. They have no similarity at all. Just for the record JPM Chase absolutely does bank startups. https://www.jpmorgan.com/commercial-banking/startups https://www.jpmorgan.com/commercial-banking/startups
- bradleyjg 4y ago
  It’s true that a 24 year old start up founder can’t just walk into a BoA branch and deposit the entire series A funds into a business checking account. We just had an object lesson in why not. That doesn’t mean there’s no way for a start up to have a banking relationship with BoA.
  - anovikov 4y ago
    Why not? I am 100% missing something here, but how someone trying to deposit money into the banks may increase risks? Unless there's a reason to believe the money is stolen or otherwise could be reclaimed, which shouldn't be the case if it's coming from a major SV fund?
    - bradleyjg 4y ago
      A deposit creates a liability for the bank. It also creates an asset that can be used to generate a return. It also creates various operational costs. The way those three things play out the more likely it is for a depositor to suddenly ask for a lot or all his money back the more risky it is for the bank. Both in terms of creating a bank run and just in terms of losing money on the relationship.

bank-error 4y ago

[flagged]

yunohn 4y ago
> None of these banks will accept a risky startup placing assets They won’t let you deposit money? Why?
biztos 4y ago
What does “placing assets” mean here? If I walk in to Citi and say “I have ten million bucks and will need to withdraw them half a million per month” are they really not going to take my deposit? I get that they might not want to loan me money, but the SVB problem everyone’s worried about is losing their deposits, or do I have that wrong?
- oefrha 4y ago
  > If I walk in to Citi and say “I have ten million bucks and will need to withdraw them half a million per month” are they really not going to take my deposit? They will take your deposit, and the banker will even get a nice fat bonus for bringing in big cash deposits (well maybe not a fat one for a meager $10m). Gp doesn’t know what they’re talking about.
oefrha 4y ago
Maybe instead of avoiding questions in replies and adding an “Edit” merely to trade insults, you can educate us on why JPM Chase won’t accept cash deposits from startups, and we can learn something. However I’m not holding my breath for insights when startup cash deposits and subprime mortgages are “similar” “bad risks” to you. They have no similarity at all. Just for the record JPM Chase absolutely does bank startups. https://www.jpmorgan.com/commercial-banking/startups https://www.jpmorgan.com/commercial-banking/startups
bradleyjg 4y ago
It’s true that a 24 year old start up founder can’t just walk into a BoA branch and deposit the entire series A funds into a business checking account. We just had an object lesson in why not. That doesn’t mean there’s no way for a start up to have a banking relationship with BoA.
- anovikov 4y ago
  Why not? I am 100% missing something here, but how someone trying to deposit money into the banks may increase risks? Unless there's a reason to believe the money is stolen or otherwise could be reclaimed, which shouldn't be the case if it's coming from a major SV fund?
  - bradleyjg 4y ago
    A deposit creates a liability for the bank. It also creates an asset that can be used to generate a return. It also creates various operational costs. The way those three things play out the more likely it is for a depositor to suddenly ask for a lot or all his money back the more risky it is for the bank. Both in terms of creating a bank run and just in terms of losing money on the relationship.