硅谷银行(SVB)最大的问题是给初创公司提供了太多贷款，而且它的BALANCE SHEET上还有很多初创公司的股票，这些初创公司的股票是Iliquid 的 Asset's VALUATION在FED加息后其实降得很厉害，不少小公司又面临倒闭甚至归零，这样SVB的CAPITAL QUALITY & Liquidity 其实是非常差的， 给初创公司的贷款坏帐也不会低的.VALUATION是 WELL OVERVALUED的。DEBT/EQUITY RATIO 当EQUITY VALUE 大大地下降后就会非常高，但是以前SVB向其它银行贷款时肯定有DEBT/EQUITY RATIO 要求，当其上升到一定程度它就必须RAISE CAPITAL 来降低这个RATIO 这种情况它必须马上RAISE CAPITAL 来降低DEBT/EQUITY RATIO。 低价卖出远远高估的初创公司股票也可能反而升高自己的DEBT/EQUITY RATIO。卖出手上的WELL OVER VALUED STARTUP SHARES 显然是不可能的。最后它宣布要卖出公司股票和可转换成普通股的公司债券来提升公司的CAPITAL.
很遗憾，花尔街RUSH TO EXIT大批WITHDRAW CASH而SVB的REAL DEBIT /EQUITY RATIO使它向其它大银行临时借款几乎不可能，这种情况就会爆。它如果卖国债，国债是最优秀的CAPITAL，即使跌一点也应该能度过难关，但是以前SVB向其它银行贷款时肯定有TIER1 CAPITAL RATIO 要求，它显然不可以卖出TIER1 国债， 否则就违反了和其它银行的贷款合同。这样SVB不就是走投无路了吗.
现在懂了为什么SVB会这么快倒闭，和其卖国债无关。
我有个孩子，他们公司在SVB有户头，一周多前就被花街告知赶快从SVB拿钱出来。还好，没损失。当SVB股票大跌时来问我买不买，我回答NEVER CATCH A FALLING KNIFE。。。
SVB Financial bought tens of billions of dollars of seemingly safe assets, primarily longer-term U.S. Treasurys and government-backed mortgage securities. SVB’s securities portfolio rose from about $27 billion in the first quarter of 2020 to around $128 billion by the end of 2021.
My husband asked me why this bank liquidated so fast
I said one thing that could get a bank liquidated is debt ratio. I don't know why it has more debt than equity all of a sudden but I know why it collasped overnight: not have enough to pay for its interbank loans. Another reason is bank run, when depositors all rush to withdraw capitals for higher yield assets. Bank deposits are low yielding assets, bank will run out of money quickly. And the institutions can sense the danger the bank faces. So the massive withdraws are very dangerous for banks. Not small individual deposits but large investors. They can take away large deposits and they are very watchful. Small individual depositors are lazier on this.
The debt ceiling problem also applies to congress. How much debt can a country have to maintain its balance sheet?
At least on paper, United States cannot have red all over the balance sheet. We have money, trillions of capitals. But cook the book is also important.
The bank's debt to asset ratio was already negative end 2022
At that time its assets were 158 b but the assets if Mark to Market is at a LOSS of 159 b. But per GAAP rule, these assets qualified to use the valuation method of Hold till Maturity. Indeed if these assets are held to maturity, the bank will get back 100% principal plus whatever interest earned based on the term.
Unfortunately due to the rapidly rising rates, its avg age of 3.6 year debts have lost a lot of value. When it is facing liquidity issue due to the IPO market literally is dead, the bank is forced to raise money.
At first it tried to sell its own shares as a secondary offering but apparently there was No Buyer. So it was forced to sell some of these assets - which of course would immediately become Mark to Market, and have Realized Loss to the tune of 1.8 b. Real Loss. It creates panic, and the VCs who funded the bank in the past now told their startups to withdraw money from the bank, created a huge bank run which no bank can survive, incl JPM or whoever.
The startups need to withdraw more and more deposits to pay its own loans. And apparently the higher borrowing rate also brings down the price of the bonds that SVC held before. Selling bonds doesn't help to raise capital. Everything went wrong at the same time.
“SVB’s deposit inflows turned to outflows as its clients burned cash and stopped getting new funds from public offerings or fundraisings” SVB和其他银行不同的是它的client里太多初创公司了，它除了给初创公司提供了太多贷款，它自己的Balance Sheet上还有很多初创公司的股票，这些公司的估值在FED加息后降得很厉害，不少小公司又面临融资困难，倒闭甚至归零。对SVB是双重打击（贷款收不回来，自己拿的那些equity value又在降）。
2. “SVB Financial bought tens of billions of dollars of seemingly safe assets, primarily longer-term U.S. Treasurys and government-backed mortgage securities. ” 本来国债是最优秀最稳定的资产，即使跌一点也应该没问题,但他们的错误是没有买短期，而是买了中长期的fixed rate的债券和MBS（据说平均3.6 year)，这些在利率上升的环境下注定会迅速贬值。
硅谷银行(SVB)最大的问题是给初创公司提供了太多贷款，而且它的BALANCE SHEET上还有很多初创公司的股票，这些初创公司的股票是Iliquid 的 Asset's VALUATION在FED加息后其实降得很厉害，不少小公司又面临倒闭甚至归零，这样SVB的CAPITAL QUALITY & Liquidity 其实是非常差的， 给初创公司的贷款坏帐也不会低的.VALUATION是 WELL OVERVALUED的。DEBT/EQUITY RATIO 当EQUITY VALUE 大大地下降后就会非常高，但是以前SVB向其它银行贷款时肯定有DEBT/EQUITY RATIO 要求，当其上升到一定程度它就必须RAISE CAPITAL 来降低这个RATIO 这种情况它必须马上RAISE CAPITAL 来降低DEBT/EQUITY RATIO。 低价卖出远远高估的初创公司股票也可能反而升高自己的DEBT/EQUITY RATIO。卖出手上的WELL OVER VALUED STARTUP SHARES 显然是不可能的。最后它宣布要卖出公司股票和可转换成普通股的公司债券来提升公司的CAPITAL.
很遗憾，花尔街RUSH TO EXIT大批WITHDRAW CASH而SVB的REAL DEBIT /EQUITY RATIO使它向其它大银行临时借款几乎不可能，这种情况就会爆。它如果卖国债，国债是最优秀的CAPITAL，即使跌一点也应该能度过难关，但是以前SVB向其它银行贷款时肯定有TIER1 CAPITAL RATIO 要求，它显然不可以卖出TIER1 国债， 否则就违反了和其它银行的贷款合同。这样SVB不就是走投无路了吗.
现在懂了为什么SVB会这么快倒闭，和其卖国债无关。
我有个孩子，他们公司在SVB有户头，一周多前就被花街告知赶快从SVB拿钱出来。还好，没损失。当SVB股票大跌时来问我买不买，我回答NEVER CATCH A FALLING KNIFE。。。
更多我的博客文章>>>
大台风后今年我南佛州房子保险费涨了近一倍，为房子买保险从统计RISK/REWARD上说似乎非常愚蠢SVB Financial bought tens of billions of dollars of seemingly safe assets, primarily longer-term U.S. Treasurys and government-backed mortgage securities. SVB’s securities portfolio rose from about $27 billion in the first quarter of 2020 to around $128 billion by the end of 2021.
here is the article:
What’s Going on With Silicon Valley Bank?
I think they didn't believe FED fund rate would get to 5-6%
我经验太少真不知判断对错。
呼吁大佬们在重要时期多发言，无论判断结果是对是错，表达自己的观点和思路，对自己对大家都一定会更有益。
Lower living standards.
Or FED has to allow hard landing.
I said one thing that could get a bank liquidated is debt ratio. I don't know why it has more debt than equity all of a sudden but I know why it collasped overnight: not have enough to pay for its interbank loans. Another reason is bank run, when depositors all rush to withdraw capitals for higher yield assets. Bank deposits are low yielding assets, bank will run out of money quickly. And the institutions can sense the danger the bank faces. So the massive withdraws are very dangerous for banks. Not small individual deposits but large investors. They can take away large deposits and they are very watchful. Small individual depositors are lazier on this.
The debt ceiling problem also applies to congress. How much debt can a country have to maintain its balance sheet?
At least on paper, United States cannot have red all over the balance sheet. We have money, trillions of capitals. But cook the book is also important.
At that time its assets were 158 b but the assets if Mark to Market is at a LOSS of 159 b. But per GAAP rule, these assets qualified to use the valuation method of Hold till Maturity. Indeed if these assets are held to maturity, the bank will get back 100% principal plus whatever interest earned based on the term.
Unfortunately due to the rapidly rising rates, its avg age of 3.6 year debts have lost a lot of value. When it is facing liquidity issue due to the IPO market literally is dead, the bank is forced to raise money.
At first it tried to sell its own shares as a secondary offering but apparently there was No Buyer. So it was forced to sell some of these assets - which of course would immediately become Mark to Market, and have Realized Loss to the tune of 1.8 b. Real Loss. It creates panic, and the VCs who funded the bank in the past now told their startups to withdraw money from the bank, created a huge bank run which no bank can survive, incl JPM or whoever.
The startups need to withdraw more and more deposits to pay its own loans. And apparently the higher borrowing rate also brings down the price of the bonds that SVC held before. Selling bonds doesn't help to raise capital. Everything went wrong at the same time.
讲的挺清楚的
“SVB’s deposit inflows turned to outflows as its clients burned cash and stopped getting new funds from public offerings or fundraisings” SVB和其他银行不同的是它的client里太多初创公司了，它除了给初创公司提供了太多贷款，它自己的Balance Sheet上还有很多初创公司的股票，这些公司的估值在FED加息后降得很厉害，不少小公司又面临融资困难，倒闭甚至归零。对SVB是双重打击（贷款收不回来，自己拿的那些equity value又在降）。
2. “SVB Financial bought tens of billions of dollars of seemingly safe assets, primarily longer-term U.S. Treasurys and government-backed mortgage securities. ” 本来国债是最优秀最稳定的资产，即使跌一点也应该没问题,但他们的错误是没有买短期，而是买了中长期的fixed rate的债券和MBS（据说平均3.6 year)，这些在利率上升的环境下注定会迅速贬值。
关键问题是，最初SVB做决定的人难道这都会不知道？这些可是外行人都知道的基本常识。
我猜想，原因有二：1. 当时虽然利率都很低，中长期债券的利率相对还是高一些，买它们在SVB的季报甚至年报上数字会好看很多，SVB自己是上市公司，也有财报压力。2. 决策人当时不认为利率会快速上升，甚至像现在这样到5%)。