[SkyMarshal]

It honestly seems like the best solution here is for a large bank like JP Morgan or Goldman to acquire SVB over the weekend and guarantee their deposits. SVB isn’t insolvent if their debt assets can be held to term, but the duration mismatch in assets and liabilities, and declining value of some of those assets due to interest rate increases, caused a liquidity shortfall and panic. But of all the types of financial problems a bank can incur, that seems like the easiest to fix via acquisition. Guarantee the deposits, restore confidence, the panic goes away, and the asset portfolio can be restructured appropriately.

The benefit to the larger bank is that SVB’s customer base represents a large chunk of the most innovative sector of the US economy and beyond. And scientific and technological innovation is only going to increase in importance as a main driver of economic growth in the world, as the developing world becomes developed and their growth rates inevitably slow. Acquiring SVB at cost seems like a great deal in that regard, and stops a panic as nice side effect.

[nuclearnice3]

That solution seems possible.

One one hand, end of December, they self-assessed that they had $209.0B in assets and $175.4B in deposits. Enough to pay everyone. [1]

On the other hand, they've suffered some losses. The regulator that closed them explicitly called them out as insolvent. [2] Possibly sloppy language, possibly they have relevant recent information.

I expect we know by Sunday night.

[1] https://www.fdic.gov/news/press-releases/2023/pr23016.html [2] https://www.cbsnews.com/news/silicon-valley-bank-sivb-stock-...

[beezle]

I think it quite likely that if there is any haircut at all it will be quite small and that is honestly a price that should be paid by the large depositors for failing to consider the many risks of keeping all their free cash at one institution.