SVB fallout. Trading in First Republic, Signature Bank, other banks halted | Hacker News Reader

SVB fallout. Trading in First Republic, Signature Bank, other banks halted

thehindubusinessline.com

10 pointsO__________O11 comments

There are two stories circulating around SVB.

(1) That it is about their investments in bonds going bad because of increasing interest rates

(2) That (1) is the straw that broke the camel's back but the real problem is that SVB has a lot of bad loans on their books.

If it is really about (1), well, lots of other banks have a huge exposure to bonds too and other banks could be affected too.

We'll see how it plays out in the next week and beyond.

I have yet to read about anyone discussing their hedging strategy regarding the bonds. Theoretically, I couldn't imagine that risk control doesn't ring a bell if a bank has a large one side exposure to anything, even treasury bonds. I think maybe reading the financial reports can reveal more as I expect to read about credit derivatives.

Circa 2000 I was at my broker and interest rates were high so I was interested in CD's and walked into to the regional bank in the office next door, picked up the annual report, liked what I saw and bought shares in Tompkins Financial Corporation which have beat the S&P 500 and paid good dividends.

As I see it TMP does well by its employees, customers, community, and also treats me very well as a shareholder.

One of my relatives signs off on the books for TMP. She can't tell me anything that she can't tell everyone else, but I've asked her about the question of "what happens if interest rates go up?" and I can say I like what I've been told.

>risk control

maybe they gave that to Chief Administrative Officer Joseph Gentile, formerly CFO of Lehman Brothers

The numbers I have seen put SVB at 56% exposed to long term bonds, vs closer to 20% at other banks. Is there another type of exposure I am missing?

https://youtube.com/watch?v=XTXNqfUWT5E

That was some kind of choir video, is that what you meant to post?

Yes. If you are not aware of the music piece “Hall of the Mountain King”, a few small and quiet initial notes lead to a cascading torrent of choral tones and heavy dynamics. Similar to this financial situation, we are hearing some of the first opening notes.

I think the strings are warming up...

https://twitter.com/Dr_PhillipB/status/1634632068058722304

Thanks, I'd heard that song before but I didn't know the name.

Brought a smile to my face, because I was just thinking the same thing.

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