what's the deal with svb? genuine question, i am very out of the loop.

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By 2021 deposits had grown from $60B to $180B in 3 years. They were growing so fast they couldn’t loan out $ fast enough, so they bought $80B of mortgage backed securities.

As interest rates rose and tech was struggling a bit more, SVB thought they’d need to sell their MBS’ to cover withdraws and potentially…

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find a security with higher yield. When they announced Weds that they wanted to sell and raise to cover this issue, investors/VCs panicked and $42B was withdrawn in 24 hrs -> run on the bank and the FDIC had to swoop in.

2. would there have been an alternative plan to cover withdraws that didn’t require selling their mortgage backed securities?

hope everyone is doing well/hanging in there during what’s clearly a very turbulent time 🙏

two things I’m particularly curious to learn more about:

1. why did the CEO sell $3.6M of SVB stock less than two weeks ago? https://i.imgur.com/4dmcIUS.jpg