Quick Take

A short timeline on what has happened to Silicon Valley Bank (SVB) and whether there is more contagion coming:

SVB saw its deposits explode during the bubble of 2020, from $62 bn at the end of 2019 to $189 bn at the end of 2021.
Due to 0% short-end rates, these firms went into long-duration investments (10+ year duration), as they could not generate the yield necessary on the deposits.
As the bond bubble burst, the worst bond performance in over 100 years, they faced massive unrealized losses.
These unrealized losses became realized losses at $1.8bn and needed to raise another $2.25bn in equity and debt.
Bank run began as account holders cashed out balances above $250,000 (FDIC insurance threshold)
Credit agencies have cut SVB’s ratings.
Pressure has now spread to all U.S. banks that saw over $80 billion wiped out in the market cap.
As a result, SVIB dropped 60% on March 9, with a further 24% pre-market
While the CEO of SVB scrambles to reassure clients, where have we that before?

The post Is SVB to big to fail? Will it get rescued? Bill Ackman already calling for bail-outs appeared first on CryptoSlate.