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Vox Nihili posted:They have a ton of assets for an insolvent bank. Depositors may end up getting back as much as 100c on the dollar, but depending on the circumstances it could take 6-12 months before they get there (absent another bank buying up the ruins) and those respective small business depositors could be finished as a going concern as early as Monday without access to the funds. Yeah, I think timing is going to be the bigger issue here than actual assets (but who knows what we'll learn after people poke around in SVB's books a little) for unsecured depositors. TBD after someone really knows anything and we're not all relying on random-rear end tweet-threads and tech sites that really don't know anything more than we do.
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Mar 11, 2023 03:19
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I imagine those companies should be able to borrow at some rate appropriate to the risk and time discounted value of their nominal or likely-to-recover deposits at SVB? Like it sucks, and will be costly, but someone's going to want to extract some profit from that risk. Hell, I'd loan Roku some money today at 10%!
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Mar 11, 2023 03:19
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So yeah crypto is probably going down too https://twitter.com/circle/status/1634341007306248199
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Mar 11, 2023 03:38
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Leperflesh posted:I imagine those companies should be able to borrow at some rate appropriate to the risk and time discounted value of their nominal or likely-to-recover deposits at SVB? Like it sucks, and will be costly, but someone's going to want to extract some profit from that risk. I mean Roku has capital markets access. Anybody that just raised $2mm or whatever is not bankable anywhere else without that cash.
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Mar 11, 2023 04:02
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Tokyo Sex Whale posted:WTF This is what I'm curious about.
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Mar 11, 2023 04:21
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Lol uh oh
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Mar 11, 2023 04:33
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cirus posted:So yeah crypto is probably going down too "probably" https://twitter.com/PeckShieldAlert/status/1634387076170010625?s=20
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Mar 11, 2023 05:00
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I don't know what the gently caress any of that means but I'm guessing SVIB was holding 1/6th of the USD funds backing these shadow coins that somehow backup other crypto coins? And so the various brokerages are pulling cash out of the other 5 potentially kicking off a run on those banks?
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Mar 11, 2023 05:11
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https://www.marketwatch.com/story/sofi-ceo-noto-makes-opportunistic-million-dollar-stock-purchase-as-svb-crisis-fuels-selloff-6063146emarketwatch posted:As SoFi Technologies Inc. shares fell Friday amid the fallout over Silicon Valley Bank’s collapse, the financial-technology company’s chief executive bought up stock.  edit: https://www.sec.gov/Archives/edgar/data/1818874/000181887423000021/xslF345X03/wf-form4_167847647511181.xml Hadlock fucked around with this message at 05:24 on Mar 11, 2023 |
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Mar 11, 2023 05:21
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pmchem posted:just based on price action, FRC, WAL, PACW and SCHW have some serious issues to look at this weekend. I read some of schwab's 10-K and it didn't look alarming but I'm not a pro financial firm analyst. SCHW isn't in the same universe as SVB or the others you mentioned. SVB had $209 billion in assets. SCHW has $7.5 trillion. For comparison, JPM has $3.6 trillion in assets. As one of the largest financial institutions on the planet, they are subject to much more strict regulation and capital requiments that SVB was not. Furthermore, Schwab's main business is in brokerage and asset management. They make their money off fees and margin loans and also just holding client cash and paying way below market rate and skimming the rest as profit. Their bank is a small portion of the overall operation. The bank is also fairly simple: it only offers a checking, savings, and some CDs. They don't have accounts for businesses and don't do mortgages (they refer you to Rocket Mortgage). SCHW 's customer base is also diversified across the country (and world), it's not hyper focused on one market segment like SVB or Silvergate were. Interesting fact: SCHW actually owns 3 legally distinct banks. If you have more than $250k cash with them they will open you an account with the other banks and automatically sweep your cash around. In this way you can have FDIC insurance of up to $750k at Schwab. Zero One fucked around with this message at 05:48 on Mar 11, 2023 |
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Mar 11, 2023 05:42
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SCHW has however taken those deposits and also invested them in a shitload of treasuries, which have incurred a uhhh lot of losses that they haven't realized yet. Appears to be around ~30B worth. Just saying "this company is more than an order of magnitude larger than that company" doesn't mean that they also aren't in trouble if people start rushing for the door and they have to start a fire sale to cover the withdrawals. I'm seeing different evaluations - "tier 1 capital" is less than their unrealized losses, but that they have plenty of other assets which could be sold if necessary (well poo poo, of course, SVB did as well). Having said all that, I did buy some calls on them (yesterday, gently caress). Cus I think they aren't going to make the same dumbass fumbles here. And hopefully monday is a lot of reassuring talk from everyone, tuesday is a good cpi print, and I can get out of this position with a nice win. However, I thought the reassuring talk was going to be *today*, and instead I woke up to "the bank is already done" messages.
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Mar 11, 2023 07:11
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Zero One posted:SCHW isn't in the same universe as SVB or the others you mentioned. SVB had $209 billion in assets. SCHW has $7.5 trillion. For comparison, JPM has $3.6 trillion in assets. As one of the largest financial institutions on the planet, they are subject to much more strict regulation and capital requiments that SVB was not. The $7 trillion number is total client assets, i.e. the value of all the brokerage accounts they have. Those are held in custody and aren't on the balance sheet at all (unlike a bank deposit). Schwab's total assets were $551 billion last quarter. Vox Nihili posted:SVB had a wide variety of financial products, it's likely that most of it was in a sweep account or the like rather than a standard deposit. That money isn't all gone but untangling it all could take ages. I can't think of any reason you'd need to be disentangling money that wasn't sitting in a deposit account.
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Mar 11, 2023 13:44
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If I was looking for discounted stocks during a period of bank failures/weakness I don't think I would pick SoFi because I could see the same thing happening to them. Good luck though!
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Mar 11, 2023 16:29
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FistEnergy posted:If I was looking for discounted stocks during a period of bank failures/weakness I don't think I would pick SoFi because I could see the same thing happening to them. Good luck though! SoFi seems to be a more normal retail bank, take deposits, make loans, issue credit and debit cards. They are just online only with lots of apps and targeting people who know what TikTok is.
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Mar 11, 2023 17:02
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But how is NDRA doing
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Mar 11, 2023 17:29
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$GOON/NDRA has been fluctuating up and down the same 10% several times over the past two weeks, tempting to repeat short-term plays like in The Olden Days. Michael Bryan, Sr. filed a 13G to register that he owns over 5% of the common stock. Didn't share his SA username though. March 14 will be the next earnings report for the past quarter and summing up 2022.
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Mar 11, 2023 18:03
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mrmcd posted:SoFi seems to be a more normal retail bank, take deposits, make loans, issue credit and debit cards. They are just online only with lots of apps and targeting people who know what TikTok is. Sofi handles student loans, the infinite money machine. I think they'll be fine.
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Mar 11, 2023 22:12
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Also rumor among VC people I know is FRC is next to die if the svb contagion isn't contained next week.
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Mar 11, 2023 23:15
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https://twitter.com/arishisays/status/1634714796271587330 Big news leak here. Quoted tweet thread is also a good read about legal limitations
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Mar 12, 2023 01:50
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https://twitter.com/ben__rickert/status/1634731804652609536 Whelp, lol.
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Mar 12, 2023 03:00
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oh no https://mobile.twitter.com/jimcramer/status/1634222320398086145
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Mar 12, 2023 03:14
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Grem posted:Sofi handles student loans, the infinite money machine. I think they'll be fine. they do student loans to the extent that they've sued, I forget who, maybe the biden administration, to get rid of the payment moratorium I might get greedy if the stock is still low on monday and pick up an ITM $6.32C for 7/21 or 10/20
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Mar 12, 2023 03:17
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Already seeing bailout noises https://twitter.com/RepSwalwell/status/1634258231718494208 personally after 2008 I'm inclined to let them get hosed
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Mar 12, 2023 03:28
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 *Pounding table* Bail out! Bail out! Bail out!
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Mar 12, 2023 04:03
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For the uninitiated, I’m assuming if a bailout happens, then we (the U.S.) just issue more bonds which increases our debt in order to bail out, correct? This seems problematic since both parties are bitching, yet again, about raising the debt ceiling.
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Mar 12, 2023 04:18
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mrmcd posted:
If there's a bailout in the sense of "we can't let you withdraw your money for whatever reason, but we can advance you an equivalent amount of money up to the FDIC limit," then I'm fine with that. I know there are individuals and legitimate small businesses involved with that bank. But that's the most I could support.
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Mar 12, 2023 04:26
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It's such a shame we don't have giant signs all over banks, right up in your face at the tellers even, talking about how FDIC insurance is only good for up to $250K. If only people had a way of knowing that the FDIC doesn't have to honor an insurance amount they didn't offer in the first place. The business aspects (payroll, etc, for people who may not even know their employers were doing biz with that bank) are a challenge that I don't know how to untangle painlessly and have no knowledge to comment on other than "ouch", so consider the scope of my snark limited to Joe Techbro with $500K in an account insured for $250K. Sundae fucked around with this message at 04:34 on Mar 12, 2023 |
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Mar 12, 2023 04:30
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nwin posted:For the uninitiated, I’m assuming if a bailout happens, then we (the U.S.) just issue more bonds which increases our debt in order to bail out, correct? Not sure about this exact case, but I believe the US government actually made a profit (like, five years later, but ultimately a profit) by later selling off assets created during the 2008 bailout
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Mar 12, 2023 04:49
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mrmcd posted:
nothing to see here, if they're making 48k in SF they have already been dead for years
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Mar 12, 2023 05:04
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surf rock posted:If there's a bailout in the sense of "we can't let you withdraw your money for whatever reason, but we can advance you an equivalent amount of money up to the FDIC limit," then I'm fine with that. I know there are individuals and legitimate small businesses involved with that bank. But that's the most I could support. I think this is basically already happening and more with just basic FDIC stuff, right? From their press release it's my understanding that FDIC already set up the bridge bank that holds up to the FDIC insured amount - which will be available for withdrawal by Monday morning at any "SVB" brick and mortar location and online later that day. Sometime next week, by the 17th, they will also be sending checks to all depositors for a TBD% portion of the uninsured amount based on their napkin math, with the remainder to be settled later. I'm guessing that whether those advance dividend checks are large enough and fast enough will be the determining factor in how many depositing companies have liquidity issues and trouble making payroll. I have no idea how long it normally takes but assessing $200B of assets and $175B in deposits and paying out dozens of billions of dollars to thousands of random people within a week just sounds impossibly fast. Sounds like they're working through lunch.
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Mar 12, 2023 06:08
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I have no idea how it works but would not surprise me if they look at the 60/90 day balance sheet of each business account, then write a check for, who knows, ~45% of the lowest balance in that period with a stipulation it had to be returned upon failed audit, or something. CFO isn't going to risk federal jail time over bank run money. Probably the same for private citizens? I looked at getting a personal account at SVIB back in 2015 (my office was almost across the street from one of their branches) there were a bunch of hoops to jump through to get one (like already having a business account with them for one year, I think?) so number of private accounts is probably less than 10%, wild rear end guess. May 17 for that check is pretty quick turnaround, going to gently caress up some payroll come mid-month though. The number of hosed up missing rent or mortgage payments should be minimal-ish, I hope. Who is going to replace SVIB? What will that do to their valuation? Has to be an existing bank(s). On one hand that's a lot of bad press/negative attention to pick up business from this sector, on the other hand that's a ton of cashflow. FDIC spun up a "bank" from nothing but takes a year just to get a provisional federal banking license, and that's if you have all your ducks in a row going into the application process.
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Mar 12, 2023 08:21
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I wonder what fees FDIC charges banks for the $250k insurance.
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Mar 12, 2023 11:57
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nwin posted:I wonder what fees FDIC charges banks for the $250k insurance. 0.03-0.42% of total deposits, every year https://www.fdic.gov/deposit/insurance/assessments/proposed.html
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Mar 12, 2023 14:44
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I sent my kid to the FDIC daycare for a while. They have one of the nicest Federal buildings I’ve been in. Even has a swimming pool.
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Mar 12, 2023 15:12
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laxbro posted:I sent my kid to the FDIC daycare for a while. They have one of the nicest Federal buildings I’ve been in. Even has a swimming pool. 
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Mar 12, 2023 15:23
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This banker Chris Whalen thinks the Fed is also to blame for SVIB's collapse. He doesn't appear to be fan of the Federal Reserve's policies or Powell. Seems to know the banking system and how banks like SVIB interact with the Federal Reserve. https://www.youtube.com/watch?v=vU1g7ZUQkWI
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Mar 12, 2023 16:46
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How much stock does he have in VC 
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Mar 12, 2023 16:52
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tldr: "You can't raise interest rates above zero! You will regret this!11"
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Mar 12, 2023 16:54
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shame on an IGA posted:tldr: "You can't raise interest rates above zero! You will regret this!11" tldr, tldw https://twitter.com/liquidiodine/status/1634609853648830467?s=20
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Mar 12, 2023 16:55
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Pollyanna posted:How much stock does he have in VC Whalen also has the controversial take that if this gets out of control and there's a big run on the banks this week then Chairperson Powell will have to resign. Hopefully this doesn't turn into a big contagion.
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Mar 12, 2023 16:56
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