Bond yield and price are inversely related, meaning when the price goes up the yield goes down and vice versa and this relationship creates the risk. If a comp

Bond yield and price are inversely related, meaning when the price goes up the yield goes down and vice versa and this relationship creates the risk. If a company buys low interest bonds (i.e. interest is yield) in a market where interest rates are going up, at some point the cash rate will exceed their bond yield and at that point the bond price drops to match the current interest rate. Why this happens is when the interest rate is above the bond yield, no one will purchase the bond at the original price, as they can get a much better return in the overnight cash market. That means the price of the bond falls to a point where the bond yield now matches the cash rate plus some margin for any future risk. That lower price gives the asset it's true value. So as the cash rate continues to rise the bond price continues to fall and without doing anything, SVG finds itself bleeding hundreds of millions in asset value, with no end in sight. That then creates the panic and the rest is history.