[HN Gopher] Joint Statement by the Department of the Treasury, F...
___________________________________________________________________
Joint Statement by the Department of the Treasury, Federal Reserve,
and FDIC
Author : FormerBandmate
Score : 293 points
Date : 2023-03-12 22:23 UTC (37 minutes ago)
(HTM) web link (home.treasury.gov)
(TXT) w3m dump (home.treasury.gov)
| debacle wrote:
| How is this not a bailout?
| bo1024 wrote:
| Important to note shareholders, executives, etc still get
| nothing.
| loeg wrote:
| Well, the term "bailout" usually implies two facts:
|
| (1) Shareholders aren't zeroed in a bailout
|
| (2) The government pays for a bailout
|
| Neither is true here.
| jen20 wrote:
| Because the shareholders lose their shareholding.
| macintux wrote:
| Taxpayers are not paying for this, banks collectively are.
| [deleted]
| nostromo wrote:
| The Venn diagram showing federal tax payers and people with a
| bank account is a circle.
| raydiatian wrote:
| > Today we are taking decisive actions to protect the U.S.
| economy by strengthening public confidence in our banking system.
|
| As cool so you're: (1) revoking the bailout money you took from
| us for the 2008 and 2020 crises
|
| (2) disallowing overdraft fees
|
| (3) reimplementing glass steagall
|
| (4) firing yourselves and then immediately committing seppukku
| cragfar wrote:
| It's pretty embarrassing how many people thought depositors
| should be on the hook for this. A banking system where companies
| or people would actually lose money due to bank failures
| (especially one caused by a run on the bank) would just lead to
| people only using BOA, JPM, and some merged WF/Citi/whoever else.
| pdq wrote:
| Yet another new precedent by the Fed and FDIC. All depositors are
| now guaranteed their funds if a bank fails.
|
| This is the definition of Moral Hazard [1].
|
| [1] https://en.wikipedia.org/wiki/Moral_hazard
| oblio wrote:
| If payment is done by other banks, doesn't that serve as
| mitigation?
|
| Sure, when the government pays, it's super risky.
|
| However if other banks pay, for sure they'll either self
| regulate or push for better legislation.
| expazl wrote:
| > If payment is done by other banks, doesn't that serve as
| mitigation?
|
| Seems the exact opposite. Why would any bank ever conduct
| risk assessment if their potential failure will be paid by
| the industry as a whole. This effectively tells any other
| bank that might be fearing for a bank run to stock up on
| super risky assets and to let the dice roll to see if they
| end up winning big, or if their competitors end up paying for
| their losses.
| Cyph0n wrote:
| But it's not other banks - it's customers of other banks.
| nostromo wrote:
| > No losses associated with the resolution of Silicon Valley Bank
| will be borne by the taxpayer.
|
| Unless you're a taxpayer with a bank account.
| [deleted]
| [deleted]
| optimalsolver wrote:
| How long until the usual crowd are back to full Ayn Rand/rugged
| individualist mode after getting their asses saved by the Fedora
| Reserve?
| jen20 wrote:
| Seeing how quickly David Sacks turned from anti government to
| practically begging the government to save him was one of the
| highlights of this weekend for me.
|
| It's almost a shame they couldn't carve out a few exceptions
| for those who don't believe in regulation.
| FormerBandmate wrote:
| It was announced as a footnote in this Treasury announcement ,
| which also guarantees 100% deposits for both SVB and Signature
| Bank above 250k
| jmclnx wrote:
| So we have a bailout. In case you missed it, SVB successfully
| lobbied Congress to weaken dodds regulations. So in a way,
| similar to 2008, Main Street pays so the rich will not loose
| their funds.
|
| https://www.theguardian.com/business/2023/mar/11/silicon-val...
|
| https://fortune.com/2023/03/11/silicon-valley-bank-svb-ceo-g...
|
| https://www.dailymail.co.uk/news/article-11847295/CEO-collap...
| colinmorelli wrote:
| This is not a bailout in the historical sense of the word.
| Equity holders in the bank are getting nothing. They'll be
| wiped out. Senior leadership has been removed.
|
| All this did was protect _depositors_, the people who put
| their money in the bank and thought it would be there
| tomorrow. And it's being done by dipping further into the
| FDIC fund, which is paid by banks. It will reach down to
| taxpayers likely through reduced rates or increased fees.
| christkv wrote:
| It's not a bailout it's a backstop. All shareholders of SVB
| are done for.
| azundo wrote:
| Sort of burying the lede - also states that all SVB depositors
| will be made whole along with Signature depositors.
| refulgentis wrote:
| Oddly, that's whats happening on Twitter too: the haute couture
| space ppl ran to start a space and frame it as "the contagion
| beginning"
|
| I find this to be an odd moment in internet history, a lot of
| its senior elders seem to have forgotten the odd effects it has
| on discourse and are unintentionally leaning into it
| archgoon wrote:
| [dead]
| FormerBandmate wrote:
| I could have sworn that was already posted here, my bad. Can
| mods change the thread title?
| clessg wrote:
| It's early enough that you _might_ still be able to do so
| yourself. I 'm not sure, though. Cmd-f (or ctrl) edit! :)
| FormerBandmate wrote:
| Good catch
| mightybyte wrote:
| I'm not quite sure of that interpretation of the text. Here's
| the quote:
|
| > We are also announcing a similar systemic risk exception for
| Signature Bank, New York, New York, which was closed today by
| its state chartering authority. All depositors of this
| institution will be made whole. As with the resolution of
| Silicon Valley Bank, no losses will be borne by the taxpayer.
|
| To me, that last sentence about SVB is distinct and separate
| and not implying that the previous sentence about Signature
| depositors applies to SVB. But you could be right as well, I
| don't think it's clear.
| kgwgk wrote:
| The "also announcing a similar" bit is a subtle hint that one
| may also want to read the previous paragraph :-)
|
| "After receiving a recommendation from the boards of the FDIC
| and the Federal Reserve, and consulting with the President,
| Secretary Yellen approved actions enabling the FDIC to
| complete its resolution of Silicon Valley Bank, Santa Clara,
| California, in a manner that fully protects all depositors.
| Depositors will have access to all of their money starting
| Monday, March 13. No losses associated with the resolution of
| Silicon Valley Bank will be borne by the taxpayer."
| swyx wrote:
| > After receiving a recommendation from the boards of the FDIC
| and the Federal Reserve, and consulting with the President,
| Secretary Yellen approved actions enabling the FDIC to complete
| its resolution of Silicon Valley Bank, Santa Clara, California,
| in a manner that fully protects all depositors. Depositors will
| have access to all of their money starting Monday, March 13.
|
| this is also material. means the fear for SVB depositors being
| unsecured creditors stops today.
| tazjin wrote:
| There used to be a TV show in Europe called "Domino Day", where
| teams competed to build very elaborate domino structures. Used to
| love the sound of the dominos falling ...
| oblio wrote:
| If you don't know what the other dominoes are or when they'll
| fall, it makes for a very boring game of dominoes.
| mkmk wrote:
| "After receiving a recommendation from the boards of the FDIC and
| the Federal Reserve, and consulting with the President, Secretary
| Yellen approved actions enabling the FDIC to complete its
| resolution of Silicon Valley Bank, Santa Clara, California, in a
| manner that fully protects all depositors. Depositors will have
| access to all of their money starting Monday, March 13. No losses
| associated with the resolution of Silicon Valley Bank will be
| borne by the taxpayer."
| FormerBandmate wrote:
| This should stop the contagion, hopefully. No losses to
| depositors, so no risk of depositing at regional banks
| kqr2 wrote:
| This special fee will most likely be passed onto bank account
| holders either through lower interest rates or higher fees, so
| most taxpayers with bank accounts will likely be affected
| indirectly.
| jachee wrote:
| Wonder how it applies, if at all, to credit unions.
| mixdup wrote:
| it does not, credit unions are not members of the FDIC.
| They are members of the NCUA, which serves the same purpose
| as the FDIC for credit unions
| bombcar wrote:
| If anything they'll benefit slightly by being able to
| offer slightly higher rates.
|
| Though hopefully the total cost after everything is
| worked out is vanishingly small - otherwise we have a
| much larger problem.
| ummonk wrote:
| They'll be less affected than they would have been if
| contagion had been allowed to spread unchecked. All banks
| have a vested interest in the stability of the financial
| system in general.
| The28thDuck wrote:
| I feel like the global banking system is surfing a wave that's
| just about to pull all of us under. I wonder if today will be an
| entry in a Wikipedia page.
| serf wrote:
| > No losses associated with the resolution of Silicon Valley Bank
| will be borne by the taxpayer.
|
| i'm out of touch with how much of this works, can someone explain
| how this is paid without burden to the taxpayer?
| AmericanOP wrote:
| SVB has assets but not liquidity. This is not like 2008 where
| the assets themselves are worthless.
| morelisp wrote:
| It's coming out of the insurance fund, which is paid into by
| banks. So the cost is still ultimately borne across a wider
| sphere, but not the government per se. (This is what's meant by
| "Any losses to the Deposit Insurance Fund to support uninsured
| depositors will be recovered by a special assessment on banks,
| as required by law.")
|
| The costs aren't borne by "the taxpayer", but an awful lot of
| taxpayers who had nothing to do with this or even purposely
| avoided it may be paying higher banking fees as a result.
| salawat wrote:
| Translation: cost is being bore by the taxpayer but people
| are staking out the stop posts on their analysis to avoid
| admitting it.
| arunabha wrote:
| Mentioned later in the announcement.
|
| > Any losses to the Deposit Insurance Fund to support uninsured
| depositors will be recovered by a special assessment on banks,
| as required by law.
| MuffinFlavored wrote:
| which banks will recoup by higher interest rates/fees? :P
| jakubadamw wrote:
| Not an expert either, but this:
|
| > Any losses to the Deposit Insurance Fund to support uninsured
| depositors will be recovered by a special assessment on banks,
| as required by law.
|
| suggests other banks will effectively pick up the bill?
| pbhjpbhj wrote:
| So taxpayers will pay, but through their bank deposits and
| mortgages?
|
| It's hard not to see how this will be "private the profits,
| democratise the losses".
| temende wrote:
| Yes, every part of the economy is indirectly connected.
| Profits are also democratised via income and capital gains
| tax, even if it's not at a high enough level that people
| feel good about.
| xyzzyz wrote:
| "Privatize the profits"? What are you talking about? The
| owners of SVB are wiped out, they will not see any profits,
| they lost their entire equity in SVB.
| unity1001 wrote:
| > "Privatize the profits"? What are you talking about?
| The owners of SVB are wiped out
|
| The depositors took risks by lending their money to such
| a risky bank for better returns in lieu of the risk. Now
| the rest of the people and businesses, who played it
| safe, will have to foot the bill for the risk that those
| depositors took.
|
| Additionally removing the burden of the deposits from SVB
| will allow it to recover some of its lost asset value.
| The state took over its liabilities now.
| ttymck wrote:
| No profits? None, ever?
|
| https://www.livemint.com/market/stock-market-news/svb-
| chief-...
| xyzzyz wrote:
| And how much stock he has left that he didn't sell, and
| lost entirely a few days later? Is this really the best
| argument for the "privatize the profits" narrative, that
| someone picked up a few pennies from in front of $6B
| steamroller?
| swyx wrote:
| idk if the numbers exactly add up here or if there are other
| sources of funding but the I in FDIC is Insurance, which is
| already paid for - the FDIC has money from insurance premiums
| to cover expected cost of losses
| [deleted]
| dathinab wrote:
| Because SVB lacks the liquidity to pay out the bank run but
| doesn't lack the assets, at least as long as you only pay out
| deposits (which is what they are doing i.e. "Shareholders and
| certain unsecured debtholders will not be protected.").
|
| The thing is that without this decision there would be two
| problems:
|
| 1. deposits would only re-accessable much later, too late for
| most small Companies to survive
|
| 2. depending on law/regulation aspects I don't know much about
| it also may have been a possibility that Stockholder get payed
| out first and similar
| shippintoboston wrote:
| How exactly are they guaranteeing all deposits? They claim to not
| be bailing them out and they haven't found a seller. I'm smelling
| bullshit.
| nemo44x wrote:
| Have we already forgot "money printing machine goes brrrrrrrr"?
| idiotsecant wrote:
| This isn't reddit.
| pcl wrote:
| "Any losses to the Deposit Insurance Fund to support uninsured
| depositors will be recovered by a special assessment on banks,
| as required by law."
| scatters wrote:
| The rest of the industry is paying. "Any losses to the Deposit
| Insurance Fund to support uninsured depositors will be
| recovered by a special assessment on banks, as required by
| law.". RIP the $250k FDIC limit, I guess.
| colinmorelli wrote:
| Dipping into the FDIC pool beyond what's needed to cover the
| $250k. That, combined with the ability to sell of SVBs assets
| must give confidence to cover all deposits without burdening
| taxpayers.
| [deleted]
| taeric wrote:
| My understanding is that all of the assets are still there.
| Moreover, many of them were expected to be safe for long term
| holding, such that anyone that can play a long game with a
| diversified portfolio could welcome these assets onto the
| books.
|
| Problem, of course, is that they were some massive assets and
| adding them to a book without unbalancing it is going to be
| difficult to do.
| xenadu02 wrote:
| The assets will take a few years to fully wind down but are
| likely to payoff anywhere from 80-98% so the actual haircut
| won't be that large. The insurance fund will float the money
| until final resolution, then increase insurance premiums if
| needed to makeup the difference.
| loeg wrote:
| I take Treasury statements at their word, and I'm not sure why
| you wouldn't too. We'll find out the details soon enough.
| nemo44x wrote:
| All depositors will be made whole. Good news. Wonder how many
| more will still fail this week.
| morelisp wrote:
| Given that the reasoning for dipping into the insurance fund is
| to prevent anything else from failing, if any more do this is
| just SV getting into the grift on the ground floor again.
| AmVess wrote:
| 9 more are on the edge.
| obblekk wrote:
| The Fed is giving banks an infinite credit line at par value of
| their assets.
|
| This allows them to borrow and cash out any customer who wants,
| so long as they have assets.
|
| This program would have saved SVB last week.
|
| People may continue moving around money, but the runs are over.
| noelsusman wrote:
| It's a bit embarrassing to have to invoke the systemic risk
| exception when regulations on these banks were relaxed in 2018 on
| the theory that they wouldn't pose a systemic risk if they got
| into trouble. This should spark some serious soul searching from
| everyone involved in that effort, but I'm not holding my breath.
|
| Anyway, I'm happy for all the depositors.
| mortenjorck wrote:
| I think there was an air of "hey, it's been ten years since
| 2008, the system is working; we can relax Dodd-Frank a little
| bit."
|
| After March 2023, the message should be an unequivocal "no, not
| even a little bit."
| AH4oFVbPT4f8 wrote:
| Why are you happy for the depositors? They took a risk
| depositing more than what was covered by fdic.
|
| to clarify, i'm happy for the employees, workers, etc that will
| remain employed while their company made poor decisions. My
| beef is that companies knowingly took risks. Would this even be
| an issue if all the VC companies didnt all try to pull their
| money out on Thur/Fri ?
| zachrip wrote:
| I'm very ignorant on the subject - what else would they do
| with the money?
| NoboruWataya wrote:
| Buy safe, highly liquid securities like t-bills, commercial
| paper, money market funds etc.
| erik_seaberg wrote:
| People have pointed out brokers that will shotgun your
| deposits across _many_ banks to game the deposit insurance
| limit, and apparently the FDIC is fine with that. But if
| every employer needs to do this, I'm not sure there's still
| a reason for separate banks to exist and compete.
| hobo_mark wrote:
| Buy treasury bills?
| Me1000 wrote:
| As others have pointed out there are of course options:
| multiple accounts, buying safe bonds, etc. But those are
| all pretty unrealistic for most small businesses. Startups
| with 3 or 4 people aren't going to spend a lot of time
| learning all the ins and outs and risks of the options
| available.
| toomuchtodo wrote:
| This is a reasonable middle ground. Depositors are made whole
| and taxpayers aren't on the hook directly (although this will
| filter down to them in aggregate in a de minimis manner).
|
| To those with large amounts of fiat hanging around: please
| don't fuck around again. Spend a few hours with your finance
| team to minimize risk. It is straightforward and well within
| the means of anyone with these cash or cash equivalents on
| hand (sweep accounts, short dated treasuries, etc). Build it
| into your runbook. Costs are minimal, consider them an
| insurance premium.
|
| Edit: if you don't have a finance team, you can get the same
| help from a contract finance professional
| lacker wrote:
| _Spend a few hours with your finance team to minimize
| risk._
|
| That's great for people who have a finance team, but a
| startup with over $250k in the bank can easily be just one
| or two people who raised money and have no particular
| finance expertise.
|
| Personally I think we should bump the limits - it should be
| reasonable for a startup that just raised $10m to be able
| to put that money somewhere safe, and pay rent, payroll,
| and an AWS bill with it, without having to hire a "finance
| team".
| eropple wrote:
| _> it should be reasonable for a startup that just raised
| $10m to be able to put that money somewhere safe, and pay
| rent, payroll, and an AWS bill with it, without having to
| hire a "finance team"_
|
| Aren't VCs supposed to support their investments with
| expertise? This is eminently socializable expertise.
|
| The entire economy does not need to insure upwards to
| protect startups.
| AH4oFVbPT4f8 wrote:
| Why are VC giving money to a company who can't manage it?
| eropple wrote:
| _> To those with large amounts of fiat hanging around:
| please don't fuck around again._
|
| They are going to. The smuglord backpatting on social media
| has already begun.
|
| But I admire your optimism.
| gizmondo wrote:
| Why bother? It seems all deposits are in fact insured
| regardless of what rules say.
| toomuchtodo wrote:
| The wheel will not always land on zero. Everyone got
| lucky there was will to bend the rules.
| hoytschermerhrn wrote:
| It's simply unrealistic for businesses to not exceed the
| $250k insurance limit.
| gameshot911 wrote:
| You can buy insurance to protect amounts above $250k.
| AH4oFVbPT4f8 wrote:
| Exactly this, take out insurance, open additional
| accounts so that the companies livelihood is not
| dependent on a single bank. What about all the companies
| who funded all these 'companies' ? Why aren't they
| stepping in to clean up the mess?
| avalys wrote:
| And who ensures that the insurance company has enough
| capital to pay out on that insurance?
| consumer451 wrote:
| I had no idea that was an option. My google-fu is failing
| me, what is that called? Who are the providers? Seems
| like it would be a mega capital intensive insurance
| product.
| ummonk wrote:
| That just moves the source of risk to the company selling
| you that insurance. If they go under as well, then that
| insurance is worthless.
| noelsusman wrote:
| We solved this problem decades ago, these businesses chose
| not to use the tools available to them to protect their
| money.
|
| https://www.intrafinetworkdeposits.com/
| eropple wrote:
| Both insured sweep accounts _and_ non-FDIC depository
| insurance exist.
| [deleted]
| Me1000 wrote:
| I can't believe we're on day 3 of this and it still has to be
| explained. SVBs depositors were mostly companies. Companies
| don't go to new banks every time their account balance
| reached $250k. If these deposits were not honored thousands
| of companies would not be able to make payroll.
| noelsusman wrote:
| https://www.intrafinetworkdeposits.com/
| morelisp wrote:
| I can't believe we're still on day 3 and people are still
| arguing with the strawman that you'd have to open an
| account per $250k to mitigate the risk. (You need to open
| two or three accounts total, and beyond that you're big
| enough to start buying your own T-Bills. And no, that
| doesn't mean you do that at $750k. Christ, it's a
| distributed systems problem, you guys should be able to
| figure this out.)
| Me1000 wrote:
| A 3 person tech startup with more than $750k is not going
| to buy treasures.
| unyttigfjelltol wrote:
| I would put it differently. SVB was a bankers' bank, _i.e._
| , venture capital. Venture capital now is systemically
| important, having initiated their own bank run.
| morelisp wrote:
| The depositors were largely those with means to manage risk but
| not doing so. Surely you mean you're happy for the workers,
| clients, contractors, etc., not the depositors? Right? The
| backstop was sold on the backs of those people, and if they're
| not the overwhelming beneficiary it means the depositors might
| not have been totally honest with us about their motives!
| kgwgk wrote:
| > Surely you mean you're happy for the workers, clients,
| contractors, etc., not the depositors?
|
| Why would anyone be happy for the workers of a bank that
| won't exist anymore in any form once the liquidation is
| sorted out?
|
| [Edit: Nevermind, my dumbass didn't understand that those
| were the workers of the depositors, the clients of the
| depositors, etc.]
| [deleted]
| ghettoimp wrote:
| The depositors did nothing here but put their own money in a
| bank account?
|
| What possible nefarious motive are you implying?
| capableweb wrote:
| > The depositors did nothing here but put their own money
| in a bank account?
|
| I'm guessing the mistake parent is implying to is that they
| put more than what was insured, knowing very well the risk
| that if the bank fail, they might only get back 250K USD,
| as it's only insured up to that.
|
| Well, in theory at least. In practice it seems the
| insurance was actually a unspecified "unlimited" amount, as
| they'll get all their funds back now.
| ZachPruckowski wrote:
| > "Any losses to the Deposit Insurance Fund to support uninsured
| depositors will be recovered by a special assessment on banks, as
| required by law."
|
| Very curious to see who ends up paying this special assessment.
| Are we all going to pay in lower deposit/investment interest from
| banks? Are bank shareholders/profits gonna eat it?
| loeg wrote:
| The balance sheet hole is likely to be relatively small.
|
| > Are we all going to pay in lower deposit/investment interest
| from banks? Are bank shareholders/profits gonna eat it?
|
| Some combination of this, I think.
| mskec wrote:
| > Shareholders and certain unsecured debtholders will not be
| protected.
|
| Shareholders and bondholders will likely lose everything as
| nothing will be left after selling off assets.
| akavi wrote:
| My reading is that the "assessment" (tax) will be borne by
| _all_ banks, not just the bank that fails.
|
| My gut says that the incidence will fall primarily on deposit
| holders (likely in the form of marginally lower interest
| rates), and not significantly on bank equity holders, but I
| suspect it'd take an econ phd to fully parse that out.
| likeabbas wrote:
| A bail out for the Bay Area. Should've just let them bust tbh
| selimnairb wrote:
| What if the Federal Reserve offered retail banking. Would it
| stabilize the banking sector? They wouldn't be forced to try to
| find loans to pay interest on deposits. Where do private banks
| add value over what the Fed could do. ELI5.
| loeg wrote:
| Banks use deposits to extend loans to other customers. A narrow
| bank wouldn't do that.
| selimnairb wrote:
| Couldn't the Fed just offer retail loans at the Federal
| Reserver rate, with maybe some kind of premium if inflation
| is high, or discount if inflation is low? What am I missing?
| Why do we need all these banks, some of which
| catastrophically explode every decade or so?
| mason55 wrote:
| Yeah, if there's too much cash sloshing around then this idea
| helps because the banks don't need to find places to put all
| their deposits.
|
| What happens normally though is that everyone banks at the Fed
| and the banks don't have any deposits and so loans freeze up,
| which is bad.
| seo-speedwagon wrote:
| This is 100% a bailout and the wording that "no losses [...] will
| be borne by the taxpayer" is a shameful misrepresentation. Just
| because a bunch of VCs and founders didn't realize they were at
| risk of this happening if they kept all their money in one bank,
| they still bear the responsibility of their losses. Looking
| forward to this new future where uninsured deposits are actually
| 100% backed by the FDIC, so actually if your company spends any
| money to diversify or de-risk your banking posture based on how
| the rules are written, you're a rube and potentially being
| irresponsible towards your shareholders
| coffeebeqn wrote:
| What's the moral hazard in the FDIC insuring a much larger
| number than 250k?
| ghettoimp wrote:
| How do we know this is a "shameful misrepresentation" until we
| see how it pans out?
| reso wrote:
| I am also confused about where the money is coming from to
| cover SVB's losses, if not from the taxpayer.
| cragfar wrote:
| The FDIC can tell banks they need to pay more into it to
| cover the losses.
| Khaine wrote:
| So much for moral hazard.
|
| Capitalism is supposed to be about profit and loss, you bail out
| the losers, there is no end to the loss.
|
| I guess we still haven't learned the lessons from 2008. Effective
| regulation should have been put in place to oversee that banks
| are effectively managing their risks. Not bailing out companies
| whenever times get tough.
| dehrmann wrote:
| > you bail out the losers, there is no end to the loss
|
| The difference here is that the "losers" made was supposed to
| be an incredibly safe bet.
|
| > I guess we still haven't learned the lessons from 2008
|
| Not my observation, but it's more like we were fighting the
| last crisis. Stress tests were focused more on bad assets, not
| safe assets in an environment with rapidly raising rates.
| Regulation and oversight only work for failure modes you're
| looking for. A handful of short sellers spotted this earlier in
| the year, but what happened is only obvious in hindsight.
| startupsfail wrote:
| Should the title of HN post be changed to the "Joint
| statement..."
| AviationAtom wrote:
| I'm surprised the top comment wasn't focusing on this bit of the
| statement:
|
| "We are also announcing a similar systemic risk exception for
| Signature Bank, New York, New York, which was closed today by its
| state chartering authority."
| version_five wrote:
| So they made their decision, everyone can move on. I just hope
| nobody forgets how prominent VCs behaved during the brief period
| of uncertainty. The idea of some noble class of investors
| championing disruption is dead. They're just a bunch of rent
| seekers like everybody else. For some silly reason I had some
| respect for the startup industry before this, now I see it as a
| joke.
|
| It's great at a personal level that "founders" and startup
| employees didn't have to do without. But it's important to
| remember that they no longer automatically deserve any credit for
| taking risks and doing something new. It might as well be a bunch
| of FAANG employees
| lambic2 wrote:
| I don't understand this comment. 1) SVB was not managed by
| VC's. 2) SVB went under because they bought US Treasuries, not
| because they took risky bets on startups.
| yawnxyz wrote:
| Incredible that this can just be done over a weekend. Is there a
| good writeup of (what I assume is a mountain-load of work) of how
| this works, and what happens during this process?
|
| Also, will the FDIC just eventually feed SVB's MBSs back into its
| insurance fund once they mature?
| wmf wrote:
| People can work fast when it matters.
| https://patrickcollison.com/fast
| winterqt wrote:
| See https://www.npr.org/2009/03/26/102384657/anatomy-of-a-
| bank-t... for some more info on how efficiently the FDIC works.
| spdustin wrote:
| The "special assessment" is levied directly on banks, and is
| referenced in 12 U.S.C. 1817(b)(5):
|
| In addition to the other assessments imposed on insured
| depository institutions under this subsection, the Corporation
| may impose 1 or more special assessments on insured depository
| institutions in an amount determined by the Corporation if the
| amount of any such assessment is necessary
|
| (A) to provide sufficient assessment income to repay amounts
| borrowed from the Secretary of the Treasury under section 1824(a)
| of this title in accordance with the repayment schedule in effect
| under section 1824(c) of this title during the period with
| respect to which such assessment is imposed;
|
| (B) to provide sufficient assessment income to repay obligations
| issued to and other amounts borrowed from insured depository
| institutions under section 1824(d) of this title; or
|
| (C) for any other purpose that the Corporation may deem
| necessary.
| bombcar wrote:
| I love how (c) makes a and b pointless.
| greatjack613 wrote:
| It's not enough for senior management to be removed. Malfeasance
| like this needs to have real life consequences.
| readthenotes1 wrote:
| misfeasance, in this case, more than malfeasance.
|
| And of course there are consequences to senior management.
|
| <s>
|
| Since they cashed out a bit and got their bonuses, they can
| probably take a vacation for a month or two and then come back
| and get a promotion in some other part of the financial
| industry. After all, they have learned a multi-billion dollar
| lesson. Don't want to throw that away!
| loeg wrote:
| It's not clear that there was malfeasance. Bad business
| performance isn't criminal.
| twiddling wrote:
| a stern talking to is in order
| weard_beard wrote:
| A stern talking to about using their infinite money wisely,
| and not charging customers for the convenience. Perhaps a
| finger wag about doubling overdrafts to pay for their
| infinite money. A _tsk_ for tripling monthly payments for
| student checking accounts.
| brunooo wrote:
| Oh, surprising re Signature, but 100% backstop should calm things
| down.
|
| Any fiat <-> crypto rails left in the US, after the FDIC buries
| SEN on, I dunno, Tuesday?
| VagueMag wrote:
| So without Signet, does Circle have any means to satisfy USDC
| redemptions?
| wmf wrote:
| Wire transfers?
| AH4oFVbPT4f8 wrote:
| It was announced as a footnote in this Treasury announcement ,
| which also guarantees 100% deposits for both SVB and Signature
| Bank above 250k
|
| How?! Who is funding this and if they sell the bank assets who is
| covering the losses?
| xenadu02 wrote:
| If you look at the FDIC data for bank closures a lot of times
| the ultimate resolution is over 90% payback - the FDIC calls
| these "dividends". In some cases the payback is 100% to
| depositors and general creditors get some money. It just takes
| time - a 2009 bank failure may not finish dividend paybacks
| until 2014.
|
| The odds are the FDIC will ultimately (in the next 5 years)
| wind down SVB's assets with enough excess to nearly cover all
| deposits. The amount the insurance fund will eat isn't likely
| to be very large.
|
| The statement about an assessment on member banks is just how
| the fund works normally: whenever there's a large payout event
| exceeding normal reserves the fund recoups the money by
| assessing member banks.
| belter wrote:
| > whenever there's a large payout event exceeding normal
| reserves the fund recoups the money by assessing member
| banks.
|
| The point you are missing is that would be to pay the
| required excess to cover the 250K per depositor, but this is
| a bailout of all depositors money.
| gnicholas wrote:
| Interesting that they're announcing this for SVB and Signature. I
| infer from this that they will backstop the depositors at these
| two banks, and they assume that by doing so no other ones will be
| 'run' by depositors.
| dehrmann wrote:
| They didn't say as much, but that was my read.
| NKosmatos wrote:
| "Depositors will have access to all of their money starting
| Monday, March 13."
|
| So, they can all go tomorrow morning and withdraw/transfer their
| money out of SVB?
| loeg wrote:
| Yes, that's my read of what it means. (Although the carcass of
| SVB was renamed to "DINB.")
| hn_throwaway_99 wrote:
| Yellen and the FDIC is in a tough spot. This is the important
| line, "Any losses to the Deposit Insurance Fund to support
| uninsured depositors will be recovered by a special assessment on
| banks, as required by law."
|
| Thus, on one hand, I'm glad they're doing this, as it should help
| prevent wider bank runs, and it ensures that banks are the ones
| that are actually paying for it.
|
| At the same time, this is yet another example of changing the
| rules in the middle of the game. Yellen has just broadcast that
| FDIC insurance is _essentially_ unlimited, as long as you can
| threaten wider disruption to the economy.
|
| I understand part of this is human nature but I really wish we
| could plan for these entirely foreseeable events _ahead of time_
| so that it 's not just cases of "selective justice" with regards
| to who gets bailed out.
| bradleyjg wrote:
| So depositors at banks taking on big risks get elevated
| interest rates or other perks for years, and when the shit hits
| the fan depositors that put their money in prudent banks get to
| bail them out through higher fees.
|
| And people wonder why turnout is low. There's no way to vote
| for non captured politicians.
| notmindthegap wrote:
| Did you foresee this?
| chejazi wrote:
| Those who did foresee it made highly profitable trades:
| https://twitter.com/notmrmanziel/status/1633940364460474372
| twelve40 wrote:
| surely it's not on HN throwaway to do all the foreseeing
| here? there are people whose fulltime job is to monitor the
| banks.
| fortenforge wrote:
| There is some sense in which this is true, but the systemic
| risk exception which they are invoking was always on the books.
| belter wrote:
| "...recovered by a special assessment on banks, as required by
| law..." - Would love to know what law/regulatory framework she
| is referring to. Janet Yellen is ready to become a US based Liz
| Truss...
|
| Now expect a contagion effect it next week, if SVB liabilities
| are shown worst than currently known, and made to bare on other
| banks capital requirements...
|
| "US banks sitting on unrealized losses of $620 billion" -
| https://edition.cnn.com/2023/03/12/investing/stocks-week-ahe...
| mixdup wrote:
| the systemic risk exceptions/procedures they're using were
| put in place after 2008
| jen20 wrote:
| ... are you sure you understand who Liz Truss is and what she
| did?
| belter wrote:
| Yes.
| hn_throwaway_99 wrote:
| > Would love to know what law/regulatory framework she is
| referring to.
|
| This is not some conspiratorial secret. Banks pay premiums to
| the FDIC for their insurance, and it's a requirement of all
| chartered banks. The FDIC has the right to backstop deposits
| in excess of the deposit limit by invoking a "systemic risk"
| clause (I'm not sure exactly which law this comes under,
| whether it's some of the original laws that created the FDIC,
| or more recent post-financial crisis updates). When the FDIC
| fund gets depleted, they have the right to invoke a special
| assessment against banks.
|
| > Now expect a contagion effect it next week
|
| The whole point of doing this is to _prevent_ a contagion.
| The reason there was a bank run against SVB was a mix not
| just that their asset values had deteriorated (that was well
| known for some time), it 's that their non-diversified
| deposit base of VC-funded start ups have gradually needed to
| up their withdrawals since early 2022. SVB would have
| survived if there wasn't a run on the bank, and the whole
| purpose of this action was to prevent further runs by saying
| that deposits will be protected.
| luckylion wrote:
| > Banks pay premiums to the FDIC for their insurance, and
| it's a requirement of all chartered banks.
|
| Do they have special rules for when the FDIC decides to
| retroactively insure some bank's deposits for more than
| $250k per account holder? Because now everyone's insurance
| premiums will go up to cover this, won't they?
| spdustin wrote:
| 12 U.S.C. 1817(b)(5) is the "regulatory framework" you're
| looking for. The FDIC can levy a special assessment for
| literally any purpose it seems necessary.
| notfromhere wrote:
| The FDIC can waive limits if it feels the deposits are of a
| systemic nature. It has had this power for a long time
| ajross wrote:
| > I really wish we could plan for these entirely foreseeable
| events ahead of time
|
| That's exactly what Dodd-Frank did. The audit and stress
| testing requirements got rolled back in the Trump
| administration. "Planning" is not the problem here.
| grey-area wrote:
| Well one way to do this would be to regulate banks more, like
| we used to:
|
| https://www.cnbc.com/2018/05/24/trump-signs-bank-bill-rollin...
|
| https://en.wikipedia.org/wiki/Glass-Steagall_legislation
| Donald wrote:
| This isn't necessarily a Glass-Steagall issue as SVB was
| primarily in government bonds and mortgage-backed securities.
| peyton wrote:
| You're saying SVB should've been designated "too big to
| fail?"
| DANmode wrote:
| Other way around.
| drdec wrote:
| > Yellen has just broadcast that FDIC insurance is essentially
| unlimited, as long as you can threaten wider disruption to the
| economy.
|
| No offense, but I thought we all learned the principle
| underlying this in 2008.
| mixdup wrote:
| Well, paying for it by a special assessment on banks means the
| banks aren't going to get a free ride. They, as a group, have
| to get their shit together otherwise they will pay dearly
| hnburnsy wrote:
| Banks won't pay employees (lower salaries or lower
| increases), shareholders (lower share price or dividends)
| and/or customers (higher fees or less interest) will.
| saurik wrote:
| I _think_ (but am honestly not 100% sure here) that the
| argument is if other banks are going to have to pay for SVB
| being greedy, it is in some sense punishing banks for not
| being greedy enough; as while, sure, the SVB investors are
| getting hit: 1) a lot of them already made a lot of money
| years ago (and potentially exited), 2) many of the executives
| apparently literally sold out last month, and 3) they were
| hoarding a lot of deposits that other banks couldn 't get
| because they weren't being risky enough. But so like, saying
| banks are paying dearly for this is strange, as it is the
| wrong banks... and, by extension, the customers at those
| banks, who are in turn making decisions about what bank to
| use in the future.
| lotsofpulp wrote:
| "They" as a group then reduce the interest rates they can pay
| their depositors because they have extra costs to pay for
| SVB's depositors gains.
| hypothesis wrote:
| This. "Backstop" thing is to prevent systemic collapse, but
| otherwise it will spread the losses to other people who
| "did nothing wrong". This is really shaping up as bad
| lesson here for wrongdoers.
| consumer451 wrote:
| As mentioned in other threads here, Germany and the UK have
| operated like this in the past as well.
|
| If it's not a loss to the tax payers, then it seems like good
| governance to me.
| patientplatypus wrote:
| I was reading this and came across "No losses associated with
| the resolution of Silicon Valley Bank will be borne by the
| taxpayer."
|
| What does this "special assessment on banks" mean in practice?
| Do they just go to all the bulge bracket banks and demand that
| they buy the outdated Treasuries at a loss? How does this work?
| JamisonM wrote:
| THEY ARE NOT IN A TOUGH SPOT!!!!
|
| They know (and it is obvious) that all deposits are going to be
| fine without any extra funds, wacko VC's and nutjob politicians
| are stoking the sort of lames that might cause a contagion so
| they are forced to make statements like this.
|
| The fact that the statement is so milquetoast is certainly on
| them, but being uber-conservative in your promises is generally
| a failing/asset for bank regulators.
| beebmam wrote:
| How do you square this statement of yours:
|
| > Yellen has just broadcast that FDIC insurance is essentially
| unlimited, as long as you can threaten wider disruption to the
| economy.
|
| with this quote from the Treasury Dept statement?
|
| > "No losses associated with the resolution of Silicon Valley
| Bank will be borne by the taxpayer."
| unethical_ban wrote:
| "Any losses to the Deposit Insurance Fund to support
| uninsured depositors will be recovered by a special
| assessment on banks, as required by law."
|
| The fungibility of money aside, my personal taxes will not
| pay for this.
| toughlover917 wrote:
| EXACTLY! This will be born by the taxpayer. What were all the
| VCs f*cking thinking concentrating all their portfolio
| companies in one financial institution? This was terrible
| decision making on their part (and by the portfolio
| companies). Why does this all of a sudden become a taxpayer
| liability? Because All-In bros got on Twitter and started
| spamming people?
| notfromhere wrote:
| FDIC gets its money by a fee charged to banks. Tax money
| isn't going into this
| roflyear wrote:
| Perfect policy doesn't exist. I prefer this to hard line
| actions that cause massive harm because it's impossible to
| account for all situations.
| vishal0123 wrote:
| > Thus, on one hand, I'm glad they're doing this, as it should
| help prevent wider bank runs
|
| Could you expand? My first thought was that the bank who is in
| verge of crisis could tip over with additional burden.
| pmorici wrote:
| Because a major component of this is human nature causing bank
| runs they are betting that by doing this upfront it will be
| cheaper than not doing it and risking a high number of similar
| bank runs in the coming month as word spreads it isn't safe to
| keep money over the insurance limit in banks because of the
| unrealized loses on bonds.
| luckylion wrote:
| At the same time, they've essentially raised the insurance
| limit to infinity. Depositors will be made whole, and if they
| aren't the next time something happens, they'll need some
| very good arguments for why the 9th largest bank is now also
| too big too fail but e.g. the 11th largest isn't.
| swatcoder wrote:
| My read is that they see the shortage at SVB as relatively
| small and that they may be closing some marginal banks like
| Signature ahead of true insolvency/illiquidity to both protect
| depositors and minimize reactionary withdrawals across the
| broader market.
|
| And it sounds like they have the authority to just do this on a
| Sunday, so it doesn't sound like any rules being changed.
|
| If I was a banker with a marginal portfolio, I wouldn't be
| encouraged by this. Depositors are making it out, but banks are
| being aggressively shuttered to make that happen.
| siavosh wrote:
| I view it kind of like parenting. Depending on what kind of kid
| you've raised you may not want to signal to them that no matter
| what you'll financially bail them out. Hoping they'll make the
| right choices.
| dehrmann wrote:
| This probably sealed the deal:
|
| > We are also announcing a similar systemic risk exception for
| Signature Bank, New York, New York, which was closed today by
| its state chartering authority.
|
| Two closures in three days is a sign that you have to take this
| very seriously.
| radicaldreamer wrote:
| This is going to put every regional bank on the map for short
| sellers as equity holders are being wiped out in these cases
| without depositors being affected. Why would anyone invest in
| any regional bank with the risk of a equity wipeout day to
| day?
| swatcoder wrote:
| > Why would anyone invest in any regional bank with the
| risk of a equity wipeout day to day?
|
| Because some have better books and management than others
| and will be underpriced because of reactionary selloffs
| like you describe?
| tedivm wrote:
| They're also taking action to prevent this kind of thing
| from happening again-
|
| > The Fed facility will offer loans of up to one year to
| banks, saving associations, credit unions and other
| institutions. Those taking advantage of the facility will
| be asked to pledge high-quality collateral such as
| Treasurys, agency debt and mortgage-backed securities.
|
| > "This action will bolster the capacity of the banking
| system to safeguard deposits and ensure the ongoing
| provision of money and credit to the economy," the Fed said
| in a statement. "The Federal Reserve is prepared to address
| any liquidity pressures that may arise."
|
| https://www.cnbc.com/2023/03/12/regulators-unveil-plan-to-
| st...
| radicaldreamer wrote:
| Yet signature bank was shut overnight?
|
| Not sure a new $25 billion facility matters when outflows
| can hit that much in a couple of hours.
| FormerBandmate wrote:
| At the same time, why would the bank runs continue? AFAIK,
| this was sparked by Silvergate's slow motion collapse
| climaxing on Wednesday, and the infinite FDIC threshold
| makes more bank runs pointless and self defeating
| 0xB31B1B wrote:
| people aren't going to pull their money out now that the
| deposits are essentially guaranteed, that is the point.
| Business can go on as usual.
| ahepp wrote:
| Does this statement reflect any shift in policy?
|
| Haven't depositors always been first on the list to get paid,
| even their uninsured deposits? I don't know if charging a
| special assessment to member banks is standard operating
| procedure, but that doesn't sound like government intervention.
| It just sounds like reasonable operation of the FDIC.
| [deleted]
| [deleted]
| mgraczyk wrote:
| In cases where you can't predict the future appropriately,
| sometimes it's better to make prudent decisions that help
| everyone instead of attempting to punish the sinful.
|
| Keep in mind that bank shareholders and senior management are
| going to get wiped out and fired.
| hn_throwaway_99 wrote:
| I mostly agree with this, but I feel like the past 25 years
| or so, ever since "the Greenspan put", has just gone more and
| more in the direction of telling people that they don't need
| to worry about doing adequate risk assessments, because if
| you have powerful people that yell loud enough, and you can
| cause enough damage, that Washington will come to the rescue.
| Eventually, I just don't see this ending well.
|
| As someone who is naturally risk averse, I feel like a
| sucker. I was having a conversation in a separate thread
| where someone remarked "How can you expect startup companies
| to spread their deposits across multiple banks?" Besides the
| fact that there are tons of account structures _specifically
| set up to do that_ , as an individual, _I_ know what these
| insurance limits are and have moved assets around accordingly
| (for me, FDIC limits weren 't relevant but SIPC limits were).
|
| How much time I wasted. I should have just gone with a
| powerful enough institution that I knew would get bailed out
| if they ever failed. I certainly won't waste my time doing
| this again, which is probably not the follow-on effect that
| the feds want.
| [deleted]
| hypothesis wrote:
| >senior management are going to get wiped out and fired
|
| Wasn't one of executives working at Lehman Brothers or some
| such before? This is just failing upwards and doing same
| thing.
| mitthrowaway2 wrote:
| "Punishing the sinful" isn't about morals, it's about
| incentives, and ensuring a level playing field where sinning
| doesn't improve your long-term competitiveness.
|
| Will senior management have to return their 2021 performance
| bonuses? If not, successful sinning is just a matter of
| ensuring you cash out early.
| mgraczyk wrote:
| Who are you trying to disincentivize? How would it dissuade
| the bank's management if depositors took a haircut? What
| behavior do you think punishing depositors would prevent?
| Do you think depositors should hire an accountant and
| economist to review their bank's balance sheet every
| quarter?
| Uvix wrote:
| If they have more than $250K in the one institution: yes,
| they should.
|
| Better yet would be spreading their deposits around, but
| if they don't want to do that, they should take the
| necessary steps to evaluate the risk appropriately.
| mgraczyk wrote:
| Ok but that's a bad policy that makes no sense and I'm
| glad the fed, Treasury, and FDIC are stepping in to
| change it. Sad that congress hasn't done anything over
| the past few years, but better the problem be solved than
| letting faith in our financial system collapse.
| moffkalast wrote:
| You mean those executives that sold their entire share of the
| bank weeks before, ending up with with fat stacks and
| completely unaffected?
|
| Yeah I kinda doubt they'll get what's coming to them
| unfortunately. Insider trading's only a crime when it's poor
| people doing it.
| DANmode wrote:
| Not entire, but enough to raise eyebrows, IIRC
| mgraczyk wrote:
| Do you think punishing depositors would disincentivize
| those executives?
|
| And do you have any examples of poor people being charged
| with insider trading? Every case I have seen is rich people
| trading.
| zamfi wrote:
| Wow, here's the real news:
|
| > Any losses to the Deposit Insurance Fund to support uninsured
| depositors will be recovered by a special assessment on banks, as
| required by law.
|
| Note the _uninsured depositors_ clause in there -- FDIC &co seem
| to have acted unilaterally to extend deposit insurance beyond the
| 250k and to the full amounts of any deposit account.
|
| And they are charging the _banks_ for it.
|
| If this doesn't stop a run on the banks, nothing will, frankly.
| chejazi wrote:
| And yet, socializing any potential losses across banks (as
| opposed to homeowners, back in 2008) feels like the appropriate
| move.
| MuffinFlavored wrote:
| > Shareholders and certain unsecured debtholders will not be
| protected. Senior management has also been removed.
|
| how do you interpret this part? what is an example of somebody
| who would be an unsecured debtholder? as in somebody with a
| stake in SVB the buisness?
|
| https://finance.yahoo.com/quote/SIVB/
| loeg wrote:
| Yeah, someone who bought SVB's corporate bonds.
| ummonk wrote:
| Yeah it's an investor who invested in a debt instrument
| offered by the bank. So CD holders will be made whole but
| holders of any corporate bonds won't.
| [deleted]
| unyttigfjelltol wrote:
| This round of bank failures was special because the debt held
| by these banks lost value because there is better stuff on the
| market, not because there was anything intrinsically
| uncollectable about the original debt. In fact, the debt
| probably is pretty similar to stuff held by everyone else in
| this ecosystem. This provides flexibility to meet the urgency
| of the situation, and FDIC, Fed, Treasury are simply saying "we
| know what the stuff is worth and there is enough money in the
| pot to make all depositors hole." "No more bank runs at this
| time please."
| dzink wrote:
| So 3 out of 7 Circle USDC bank partners failed in a week.
|
| https://www.coindesk.com/markets/2023/03/10/scrutiny-falls-o...
| 323 wrote:
| All bank deposits should be guaranteed by the state.
|
| Just like tap water is guaranteed to be drinkable, ... Bank
| accounts are the basis of many things.
| coffeebeqn wrote:
| Yeah as long as the banks hold actually valuable things- SVB
| had treasury bonds- no reason the federal government can't
| treat those as cash. I mean it's their own issued assets!
| NotACop182 wrote:
| Maybe banks shouldn't be able to place bets with depositor
| funds.
| fossuser wrote:
| Probably the best possible outcome.
|
| Protect depositors, allow stock holders to get wiped, prevent a
| cascade of runs from fear.
| balozi wrote:
| So, is this a bailout, that we are definitely absolutely not
| calling a bailout?
| baal80spam wrote:
| Yup, and we can expect a movie in a few years.
| loeg wrote:
| > As with the resolution of Silicon Valley Bank, no losses will
| be borne by the taxpayer.
|
| > Shareholders and certain unsecured debtholders will not be
| protected. Senior management has also been removed.
| nostromo wrote:
| It's a bailout with the costs borne by other banks.
|
| And those costs will be paid by anyone with a bank account.
| avalys wrote:
| It's not a bailout. Silicon Valley Bank will cease operating,
| the shareholders get zero, anyone who loaned them money likely
| gets zero, the executives have been fired, the employees will
| all be laid off within two months.
|
| The point of this action is to ensure that Silicon Valley
| Bank's customers, however, will not be harmed by doing business
| with a regulated major bank.
| kizer wrote:
| Let's just not make this a habit!
| belter wrote:
| "...Any losses to the Deposit Insurance Fund to support uninsured
| depositors will be recovered by a special assessment on banks, as
| required by law..."
|
| Is this what passes for a FED press release? Which law? Clear as
| mud. Did the Fed just established an infinite deposit insurance
| coverage in the US?
| spdustin wrote:
| 12 U.S.C. 1817(b)(5) (starting on the bottom right of the page
| numbered 980, page 5 of this PDF [0])
|
| [0]:
| https://www.govinfo.gov/content/pkg/USCODE-2021-title12/pdf/...
| [deleted]
| ecommerceguy wrote:
| I'm just curious, who was running the investment / risk team at
| SVB and why should they get a pass for doing such a terrible job?
| mgraczyk wrote:
| They don't, they got fired already.
| TigeriusKirk wrote:
| They've been fired and their bank has been shut down.
|
| Not sure how they're getting a pass.
| spencerflem wrote:
| because they're not losing any money. we all are
| (collectively) by bailing them out
| askl56 wrote:
| From the UK branch which also is in severe trouble[0]
|
| Jay Ersapah, the boss of Financial Risk Management at SVB's UK
| branch, launched initiatives such as the company's first month-
| long Pride campaign and a new blog emphasizing mental health
| awareness for LGBTQ+ youth.
|
| "The phrase 'you can't be what you can't see' resonates with
| me,'" Ersapah was quoted as saying on the company website.
|
| "As a queer person of color and a first-generation immigrant
| from a working-class background, there were not many role
| models for me to 'see' growing up."
|
| Her efforts as the company's European LGBTQIA+ Employee
| Resource Group co-chair earned her a spot on SVB's "outstanding
| LGBT+ Role Model Lists 2022," a list shared in a company post
| just four months before the bank was shut down by federal
| authorities over liquidity fears.
|
| [0] https://nypost.com/2023/03/11/silicon-valley-bank-pushed-
| wok...
| piperswe wrote:
| I'm not sure how relevant this is to the topic at hand.
| AmVess wrote:
| The entire c-suite were running things at Lehman and DB and
| flew those into the ground, too.
| gnicholas wrote:
| Apparently they had no Chief Risk Officer for much of the last
| year: https://fortune.com/2023/03/10/silicon-valley-bank-chief-
| ris...
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