FDIC onsite at First Republic Bank tonight
twitter.com
twitter.com
"Also by the end of the day today (Saturday) they stopped processing wires altogether."
Banks never process wires over the weekend. In fact, the following tweet in the thread admits this.
"The previous wording when trying to wire out of First Republic on Saturday is 'wire will be sent first thing Monday'. Now the wording changed to 'thank you for your transaction we'll get back to you'"
That was not the previous wording, and the wording did not change. (I just verified this myself.) If this was true, a screenshot proof would be easy to provide, but none was given.
"FRC's business model depends on a gentleman's agreement. Essentially, you deposit close to 30% of the loan value with FRC in a deposit account with a 0% interest rate in return for large (mostly) real estate loans at below market interest rates."
This makes no sense. For real estate loans, which the tweet specifically mentions, you would not just keep the loan amount sitting around in a bank account. You'd use it to buy the real estate that you got the loan for.
Etc.
This person is very confused, at best. Do not believe this tweet thread.
Total and complete speculation but just a thought.
But why would a bailout be needed? Where are people getting the idea that they don't have more than enough assets for all their customers?
What I read last week was that they had a classic bank run, where they couldn't liquidate long term bonds fast enough when everyone panicked.
Is there something else going on?
FED's recent higher rates for longer policy is death sentence for VC's and personal wealth of many people... So they are trying to create moral panic in order to reverse FED policy..
They will not succeed.. Rates will stay higher but a discount window will be made available for banks like SVB....
Populist criticism of the Fed cannot identify the point that is "too far", but surely like a stopped clock they eventually have to be right.
Isn't an inverted yield curve a warning signal that can't be dismissed as economically illiterate populism?
This is crypto Twitter excited to find some reason to justify digital assets as an alternative store of value, and then trying to bolster it by causing panic at another bank.
Either that, or as another poster said, forcing the hand of the Fed to bail out SVB.
Bank runs are a tragedy of the commons, trampling people in panic and naked greed, burning down the system of the world on the way out. Don't believe the hype.
They're citing "their friend" and posting other stuff from the daily mail. Like... No.
Before that? Basically you have to go back to the 1930s. There were some issues during the Savings and Loan Crisis (ex. Ohio), but none are considered to be Type 3s.
We have managed to go backwards 90 years.
Not to say it isn't necessarily untrue, but some guy on twitter saying "my friend says so" isn't very convincing. Bigly if true though!