4 ms·

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".

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".