SVB bank: why investments failed veerigadu

[paaparao]

calling @veerigaduveerigadu. expert in everything.

why SVB Bank investments in mortgage backed securities failed? why their investments in US Treasury Bonds failed?

 

[veerigadu]

I'm not an expert anna. Wrong narrative btw. 

Their investments didn't fail per se. As a matter of the fact, they were very secure investments.

But they are not profitable anymore due to increasing interest rates. Also, they just parked too much money in those long term bonds/securities. Its not easy to liquidate without taking a loss at this moment. 

Thappu matladitheee kshaminchuuu

 

[paaparao]

1 minute ago, veerigadu said:

I'm not an expert anna. Wrong narrative btw. 

Their investments didn't fail per se. As a matter of the fact, they were very secure investments.

But they are not profitable anymore due to increasing interest rates. 

 

how. explain why they took loss?

[Ryzen_renoir]

35 minutes ago, paaparao said:

calling @veerigaduveerigadu. expert in everything.

why SVB Bank investments in mortgage backed securities failed? why their investments in US Treasury Bonds failed?

 

Their investments didn't fail , their risk management team was garbage and didn't plan well 

Almost all banks in US have liabilities /cash in hand in the ratio of 10:1 . No bank in USA can withstand depositors withdrawing money at the same time

silicon valley is very tight knit community , a group of investors felt that SVB is too risky and withdrew 42 bil$ in one day creating a bank run  . Peter thiel is apparently the guy who adviced VC's to withdraw everything 

I am hearing rumours that it was a organised run to damage SVB so that Brex and JP morgan can occupy the lucrative space 

 

[kevinUsa]

19 minutes ago, Ryzen_renoir said:

Their investments didn't fail , their risk management team was garbage and didn't plan well 

Almost all banks in US have liabilities /cash in hand in the ratio of 10:1 . No bank in USA can withstand depositors withdrawing money at the same time

silicon valley is very tight knit community , a group of investors felt that SVB is too risky and withdrew 42 bil$ in one day creating a bank run  . Peter thiel is apparently the guy who adviced VC's to withdraw everything 

I am hearing rumours that it was a organised run to damage SVB so that Brex and JP morgan can occupy the lucrative space 

 

Brex ante

[Ryzen_renoir]

23 minutes ago, kevinUsa said:

Brex ante

It's a fintech company based in silicon valley 

[odhu_le_macha]

[LadiesTailor]

‘It’s a big failure for us.’ Sweden’s largest pension fund invested in both Silicon Valley Bank and Signature Bank before they failed
 

list started… inka enne bayatku vastayo 

[pakeer_saab]

23 hours ago, veerigadu said:

I'm not an expert anna. Wrong narrative btw. 

Their investments didn't fail per se. As a matter of the fact, they were very secure investments.

But they are not profitable anymore due to increasing interest rates. Also, they just parked too much money in those long term bonds/securities. Its not easy to liquidate without taking a loss at this moment. 

Thappu matladitheee kshaminchuuu

 

eee DB ki Raghuram Rajan lantodivi.. endukanta bedda matalu matladataavu

[kathiramdasu]

They invested lot of money(80B) in government bonds. These bonds where high interest yielding at that time, due to inflation the newly issued Government bonds where even more high yielding. So the bonds they had became less valuable. 15B losses

Many customer started to withdraw money, since they didn't have enough money for their daily cash activities which caused a ripple effect . To sell lot of bonds in loss.

No chief risk officer for 8 months who should have liquidated the less valuable government bonds.