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There's a lot of speculation that Signature was solvent and this is a conspiracy against crypto. Let's look at their balance sheet: https://www.cnbc.com/quotes

There's a lot of speculation that Signature was solvent and this is a conspiracy against crypto. Let's look at their balance sheet: https://www.cnbc.com/quotes/SBNY?tab=financials https://www.cnbc.com/quotes/SBNY?tab=financials $110B assets against $102B liabilities. That's 7.8% more capitalization, one of the lowest I've seen across all banks. Want to guess how much of those were hold to maturity (HTM) and thus actually market value of 5% - 20% less? If their portfolio was as conservative as just a 3 year Treasury bond, which has risen 3% in the past year, they would've lost 9% and been insolvent now. But we already know banks like SVB have been going far riskier for yield; 10 year MBS compared to 3y Treasuries... Also, this thread for evidence of the clown show running the bank https://twitter.com/GRDecter/status/1635322707746357254 https://twitter.com/GRDecter/status/1635322707746357254

bombcar 4y ago
Check the capitalization report from SVB; they had way more assets than liabilities (on paper).
junofan 4y ago
Can you point to an official statement declaring insolvency?
- mikeyouse 4y ago
  We can get ~close with public info.. On March 8th - they had $89 billion in deposits. It's unclear what happened on March 9th, but on March 10th, clients withdrew a further 20% of that balance so ~$19 billion. On March 8th, they had $4.5 billion cash. So they would need to find another $15 billion in assets just to cover the withdrawals from that one day. They had already markedly increased their loan drawdown from FHLB from $3B in 2021 to almost $9B in 2022, so their ability to draw it further in the face of a bank run was definitely impacted. It's astronomically more likely that their financial condition deteriorated further from there rather than some bizarre anti-crypto conspiracy theory as is apparently favored by commenters here. We'll get confirmation in the coming week or two as more details on their condition over the weekend are released, which of course is another point in favor of the boring answer. https://investor.signatureny.com/pme/press-releases/news-details/2023/Signature-Bank-Issues-Updated-Financial-Figures-as-of-March-8-2023-Reiterates-Strong-Financial-Position-and-Limited-Digital-Asset-Related-Deposit-Balances-in-Wake-of-Industry-Developments/default.aspx https://investor.signatureny.com/pme/press-releases/news-det...
  - EntrePrescott 4y ago
    > They had already markedly increased their loan drawdown from FHLB from $3B in 2021 to almost $9B in 2022 For that matter, I kinda wonder about the risk assessment and loan decision mechanisms of those FHLBs. Even aside from the fact that I don't know how the crypto stuff of Signature would fall under the "housing finance and community investment" that the FHLBs are supposed to provide liquidity for, I can't really imagine how the people who let those loans increase by 6·10⁹$ within just a year could look at where the money would go at Signature and tell themselves "oh that's okay, we're gonna get that money back".
say_it_as_it_is 4y ago
It's ironic that you cite GRDecter's Twitter feed for exposing anything as a clown show

bombcar 4y ago

Check the capitalization report from SVB; they had way more assets than liabilities (on paper).

junofan 4y ago

Can you point to an official statement declaring insolvency?

mikeyouse 4y ago
We can get ~close with public info.. On March 8th - they had $89 billion in deposits. It's unclear what happened on March 9th, but on March 10th, clients withdrew a further 20% of that balance so ~$19 billion. On March 8th, they had $4.5 billion cash. So they would need to find another $15 billion in assets just to cover the withdrawals from that one day. They had already markedly increased their loan drawdown from FHLB from $3B in 2021 to almost $9B in 2022, so their ability to draw it further in the face of a bank run was definitely impacted. It's astronomically more likely that their financial condition deteriorated further from there rather than some bizarre anti-crypto conspiracy theory as is apparently favored by commenters here. We'll get confirmation in the coming week or two as more details on their condition over the weekend are released, which of course is another point in favor of the boring answer. https://investor.signatureny.com/pme/press-releases/news-details/2023/Signature-Bank-Issues-Updated-Financial-Figures-as-of-March-8-2023-Reiterates-Strong-Financial-Position-and-Limited-Digital-Asset-Related-Deposit-Balances-in-Wake-of-Industry-Developments/default.aspx https://investor.signatureny.com/pme/press-releases/news-det...
- EntrePrescott 4y ago
  > They had already markedly increased their loan drawdown from FHLB from $3B in 2021 to almost $9B in 2022 For that matter, I kinda wonder about the risk assessment and loan decision mechanisms of those FHLBs. Even aside from the fact that I don't know how the crypto stuff of Signature would fall under the "housing finance and community investment" that the FHLBs are supposed to provide liquidity for, I can't really imagine how the people who let those loans increase by 6·10⁹$ within just a year could look at where the money would go at Signature and tell themselves "oh that's okay, we're gonna get that money back".

say_it_as_it_is 4y ago

It's ironic that you cite GRDecter's Twitter feed for exposing anything as a clown show