[lejohnq]

I think it would cover interest rate risk because an increase in rates causes bond value to decrease, implying the bonds SVB held lose value and they would not be able to cover capital.

And if they have to value it appropriately every quarter, the issue likely would have been seen earlier and maybe they could have changed their positions as the rates were rising instead of being in a hole and trying to do it all at once.

At least I think that’s how the regulations might have worked here.