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But the ultimate crux is done by the Federal Reserve Board for allowing $50+B --> non-bank <-- to skimp on the stress test. (emphasis is mine but the key crux).
by egberts1 4y ago
But the ultimate crux is done by the Federal Reserve Board for allowing $50+B --> non-bank <-- to skimp on the stress test. (emphasis is mine but the key crux). This was done on March 14. 2014, which is 4 years earlier.
"Finally, the Board has determined not to impose enhanced prudential standards on nonbank financial companies supervised by the Board through this final ($50B stress test) rule."
Not seeing any partisan hacks there, unless you count the financial ones.
https://www.govinfo.gov/content/pkg/FR-2014-03-27/html/2014-05699.htm https://www.govinfo.gov/content/pkg/FR-2014-03-27/html/2014-...
- samirillian 4y agoELI5?
- LandoCalrissian 4y agoI can't remember all the specifics, but after the 2008 crash banks with a certain levels of holding have to pass stress test showing they can survive scenarios like this. I think the old limit was 50 billion but go changed to I think 150 billion which puts SVB below the threshold for the stress test.
- CalChris 4y agoTrump increased this to $250B in 2018. SVB as the 16th largest bank in the US at $209B didn’t trip this wire because the wire was moved.
- egberts1 4y agoYou missed the part about "non-bank" exempted from ANY limit on March 14, 2014 in the FR Notice.
- CalChris 4y ago“I think the old limit was 50 billion but go changed to I think 150 billion which puts SVB below the threshold for the stress test.” Maybe the parent post missed that but I was responding to that post.
- KRAKRISMOTT 4y agoWhy should non-interest bearing electronic wallets be subjects to the same limits? Cash is less of a liability for them.
- maxbond 4y agoPerhaps it'd be better to combine a dollar value with a percentile, eg, "each of the top banks representing X% of total deposits or with > $YB of deposits"