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I'm curious how you got that from this article. To quote, "SVB actually did relatively little lending, for a bank, and had rather a lot of safe bonds." That i

by taeric 4y ago

I'm curious how you got that from this article. To quote, "SVB actually did relatively little lending, for a bank, and had rather a lot of safe bonds." That is, they were run like you would expect a small regional bank that doesn't like milking interest out of their region to be run. Straight forward take in deposits and stick them somewhere with silly modest returns. Are there other sources going into shady things they were doing?

oski 4y ago
This article touches on some: https://www.nytimes.com/2023/03/17/technology/svb-tech-start-ups.html https://www.nytimes.com/2023/03/17/technology/svb-tech-start...
- taeric 4y ago
  I'm not sure that is really underlining too many "sleezy" things happening, though? Honestly reads more of "regional bank caters heavily to region it is in" to me. And some of the numbers are high looking in this, but it literally states "its $9.5 billion fund," when the article here is talking about how it had 100+ billion in bonds. Which were deemed safe. Let that sink in. Yes, they had 9 billion they were investing. But they had over 120 billion sunk in "safe" bonds. That is, the 9 billion was /supposed/ to be the risky part of their portfolio. Yes, they probably took some excess risk there. But that is definitively not the risk that tanked them. And any complaints in that direction is a side show that has virtually nothing to do with what happened. Unless you want to say they weren't doing it enough.
alasdair_ 4y ago
>a small regional bank They were in the top 20 biggest banks in the USA. "regional" is a term of art more than used in the conventional way. I think that most people who hear "regional bank" think of one with only a few branches and a relatively small amount of assets (compared to global behemoths). SVB was very much a world-class player in terms of both general sophistication and AUM.
- taeric 4y ago
  Right, my understanding from following is they should have been run with the sophistication that their size and exposure would have warranted; but were instead still playing the game as if they were the regional bank they started as.

by taeric 4y ago

oski 4y ago

This article touches on some: https://www.nytimes.com/2023/03/17/technology/svb-tech-start-ups.html https://www.nytimes.com/2023/03/17/technology/svb-tech-start...

taeric 4y ago
I'm not sure that is really underlining too many "sleezy" things happening, though? Honestly reads more of "regional bank caters heavily to region it is in" to me. And some of the numbers are high looking in this, but it literally states "its $9.5 billion fund," when the article here is talking about how it had 100+ billion in bonds. Which were deemed safe. Let that sink in. Yes, they had 9 billion they were investing. But they had over 120 billion sunk in "safe" bonds. That is, the 9 billion was /supposed/ to be the risky part of their portfolio. Yes, they probably took some excess risk there. But that is definitively not the risk that tanked them. And any complaints in that direction is a side show that has virtually nothing to do with what happened. Unless you want to say they weren't doing it enough.

alasdair_ 4y ago

>a small regional bank They were in the top 20 biggest banks in the USA. "regional" is a term of art more than used in the conventional way. I think that most people who hear "regional bank" think of one with only a few branches and a relatively small amount of assets (compared to global behemoths). SVB was very much a world-class player in terms of both general sophistication and AUM.

taeric 4y ago
Right, my understanding from following is they should have been run with the sophistication that their size and exposure would have warranted; but were instead still playing the game as if they were the regional bank they started as.