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Credit Suisse - rogpodge - 03-19-2023

Being bought in a (forced) sale for $2B. Was technically worth $7B two Fridays ago? 

Community banks are about to get wiped out. Consolidation in the banking industry is upon us (and that's not a good thing). Buckle up, everyone, it is going to be a bumpy ride.

For the stress testing fans out there.

https://twitter.com/WallStreetSilv/status/1637514295012458500

RE: Credit Suisse - TonyLima - 03-19-2023

Might want to check out the "too big to fail" doctrine.  Argument is that large banks act very much like the Fed with respect to small banks.  The big banks provide check clearing and transactions services, as well as holding what amounts to excess reserves.  SVB was the 16th largest bank in the U.S.  We now have a new lower limit on "too big."  My take on SVB here.

RE: Credit Suisse - gailtate - 03-19-2023

There's a whole generation in finance-and-venture-land today that actually believes high returns should come with low, if any, risks.
AYFKM?! When you're dancing on the edge of the cliff for a living, precipitous falls into the abyss are supposed to be part of "the deal", aren't they?

RE: Credit Suisse - Mick - 03-19-2023

(03-19-2023, 12:00 PM)rogpodge Wrote:  Being bought in a (forced) sale for $2B. Was technically worth $7B two Fridays ago? 

Community banks are about to get wiped out. Consolidation in the banking industry is upon us (and that's not a good thing). Buckle up, everyone, it is going to be a bumpy ride.

Midsize US Banks Ask FDIC to Insure All Deposits for Two Years

RE: Credit Suisse - TrumpCard - 03-19-2023

(03-19-2023, 03:45 PM)gailtate Wrote:  There's a whole generation in finance-and-venture-land today that actually believes high returns should come with low, if any, risks.
AYFKM?! When you're dancing on the edge of the cliff for a living, precipitous falls into the abyss are supposed to be part of "the deal", aren't they?

Can you be more specific about the high returns and risks you mean?

I don’t think you’re referring to the returns banks give on uninsured deposits. The returns aren’t high at all. Companies may foolishly believe that uninsured deposits aren’t risky, but it’s unclear to me that said companies get much of a reward for the risk. 

I also don’t think you’re referring to the fate of executives, or debt or equity holders, at SVB or Signature. They’re all fired or zeroed out. 

CS execs are largely going to be fired as well, and CS debt and equity holders are faring only a little better than their counterparts with SVB and Signature. 

We don’t yet know what’ll happen to the rest of the mid-sized banks currently under distress in the US, but it doesn’t seem as though they’re likely to get government bail outs. If anything, maybe they’ll get expensive sources of liquidity like Berkshire Hathaway provided to GS and BofA back during the 2008 financial crisis. If so, that is a form of punishment for taking excessive risk.

RE: Credit Suisse - rogpodge - 03-19-2023

https://twitter.com/lisaabramowicz1/status/1637535219497541632

I'm not sure what this means, but it can't be good. The Swiss banks' reputations were built on secrecy, and safety / ability to price risk.

RE: Credit Suisse - TrumpCard - 03-19-2023

(03-19-2023, 06:36 PM)rogpodge Wrote:  https://twitter.com/lisaabramowicz1/status/1637535219497541632

I'm not sure what this means, but it can't be good. The Swiss banks' reputations were built on secrecy, and safety / ability to price risk.

Isn’t that rich. The Swiss — whose success in banking depended largely on hiding the assets of war criminals, arms dealers, and organized criminal syndicates — are blaming the U.S. for their banking failures. I’m as concerned about the banking industry as most you all, but if there were one big bank in the world that brought on its own demise, it’s probably Credit Suisse.

RE: Credit Suisse - Hurlburt88 - 03-20-2023

interesting quote

“The real challenge is the rundown of the investment banking activities,” UBS Chief Executive Ralph Hamers said on a call with analysts Sunday evening.

RE: Credit Suisse - TrumpCard - 03-20-2023

Another quote on the same issue with CS’ investment banking division, this from UBS’ Chairman. Makes you wonder what kind of risks CS was taking. 

UBS said it expects to generate cost savings of $8 billion per year by 2027. Credit Suisse's investment bank is in the crosshairs. 

"Let me be clear. UBS intends to downsize Credit Suisse's investment banking business and align it with our conservative risk culture," Kelleher said.

https://amp.cnn.com/cnn/2023/03/19/business/credit-suisse-ubs-rescue/index.html

RE: Credit Suisse - Mick - 03-20-2023

The Fed flagged SVBs risk management profile back in 2019, and increased their, shall we say, collective expressions of alarm in 2020, 2021 and July, 2022. The most interesting part to me is that SVB was allowed to triple in size in less than three years after the alarms were raised.

Fed Raised Concerns About SVB’s Risk Management in 2019

RE: Credit Suisse - Beeg_Dawg - 03-20-2023

(03-20-2023, 09:11 AM)Mick Wrote:  The Fed flagged SVBs risk management profile back in 2019, and increased their, shall we say, collective expressions of alarm in 2020, 2021 and July, 2022. The most interesting part to me is that SVB was allowed to triple in size in less than three years after the alarms were raised.

Fed Raised Concerns About SVB’s Risk Management in 2019

Mick - how was SVB allowed to triple in size? How does the FED toss out an anchor to slow down SVB's growth? What options are available to the FED when it flags a banks risk management profile?

RE: Credit Suisse - TonyLima - 03-20-2023

(03-20-2023, 03:56 PM)Beeg_Dawg Wrote:  
(03-20-2023, 09:11 AM)Mick Wrote:  The Fed flagged SVBs risk management profile back in 2019, and increased their, shall we say, collective expressions of alarm in 2020, 2021 and July, 2022. The most interesting part to me is that SVB was allowed to triple in size in less than three years after the alarms were raised.

Fed Raised Concerns About SVB’s Risk Management in 2019

Mick - how was SVB allowed to triple in size? How does the FED toss out an anchor to slow down SVB's growth? What options are available to the FED when it flags a banks risk management profile?

I’ll be writing about this Tuesday. Preview: the regulators did everything they were legally allowed to do. If management continually ignores them, that’s on Greg Becker et. al., not the Fed.

RE: Credit Suisse - TrumpCard - 03-20-2023

(03-20-2023, 04:56 PM)TonyLima Wrote:  
(03-20-2023, 03:56 PM)Beeg_Dawg Wrote:  
(03-20-2023, 09:11 AM)Mick Wrote:  The Fed flagged SVBs risk management profile back in 2019, and increased their, shall we say, collective expressions of alarm in 2020, 2021 and July, 2022. The most interesting part to me is that SVB was allowed to triple in size in less than three years after the alarms were raised.

Fed Raised Concerns About SVB’s Risk Management in 2019

Mick - how was SVB allowed to triple in size? How does the FED toss out an anchor to slow down SVB's growth? What options are available to the FED when it flags a banks risk management profile?

I’ll be writing about this Tuesday. Preview: the regulators did everything they were legally allowed to do. If management continually ignores them, that’s on Greg Becker et. al., not the Fed.

I'm interested in the article and hope you link it here, but in the interest of avoiding another lockdown, I will not comment as to who is at fault.  ;-)

RE: Credit Suisse - chrisk - 03-20-2023

(03-20-2023, 03:56 PM)Beeg_Dawg Wrote:  
(03-20-2023, 09:11 AM)Mick Wrote:  The Fed flagged SVBs risk management profile back in 2019, and increased their, shall we say, collective expressions of alarm in 2020, 2021 and July, 2022. The most interesting part to me is that SVB was allowed to triple in size in less than three years after the alarms were raised.

Fed Raised Concerns About SVB’s Risk Management in 2019

Mick - how was SVB allowed to triple in size? How does the FED toss out an anchor to slow down SVB's growth? What options are available to the FED when it flags a banks risk management profile?

The Fed has capped Wells Fargo asset size at $1.93 trillion since 2018 (via a cease and desist order signed by all of the Board of Directors) so that is a tool that Fed has at its disposal. (But it would have to articulate its concerns).

RE: Credit Suisse - TonyLima - 03-20-2023

(03-20-2023, 05:42 PM)TrumpCard Wrote:  
(03-20-2023, 04:56 PM)TonyLima Wrote:  
(03-20-2023, 03:56 PM)Beeg_Dawg Wrote:  
(03-20-2023, 09:11 AM)Mick Wrote:  The Fed flagged SVBs risk management profile back in 2019, and increased their, shall we say, collective expressions of alarm in 2020, 2021 and July, 2022. The most interesting part to me is that SVB was allowed to triple in size in less than three years after the alarms were raised.

Fed Raised Concerns About SVB’s Risk Management in 2019

Mick - how was SVB allowed to triple in size? How does the FED toss out an anchor to slow down SVB's growth? What options are available to the FED when it flags a banks risk management profile?

I’ll be writing about this Tuesday. Preview: the regulators did everything they were legally allowed to do. If management continually ignores them, that’s on Greg Becker et. al., not the Fed.

I'm interested in the article and hope you link it here, but in the interest of avoiding another lockdown, I will not comment as to who is at fault.  ;-)

Preview here:

https://www.nytimes.com/2023/03/19/business/economy/fed-silicon-valley-bank.html?smid=nytcore-ios-share&referringSource=articleShare

RE: Credit Suisse - Mick - 03-21-2023

(03-20-2023, 04:56 PM)TonyLima Wrote:  
(03-20-2023, 03:56 PM)Beeg_Dawg Wrote:  
(03-20-2023, 09:11 AM)Mick Wrote:  The Fed flagged SVBs risk management profile back in 2019, and increased their, shall we say, collective expressions of alarm in 2020, 2021 and July, 2022. The most interesting part to me is that SVB was allowed to triple in size in less than three years after the alarms were raised.

Fed Raised Concerns About SVB’s Risk Management in 2019

Mick - how was SVB allowed to triple in size? How does the FED toss out an anchor to slow down SVB's growth? What options are available to the FED when it flags a banks risk management profile?

I’ll be writing about this Tuesday. Preview: the regulators did everything they were legally allowed to do. If management continually ignores them, that’s on Greg Becker et. al., not the Fed.

Becker, former CFO Daniel J. Beck and SVB Financial Group just engaged James Neil Kramer and Alexander Talarides of Orrick for their shareholder lawsuit defense. They're well-recognized litigators, so he's taking it seriously.  First appearances in U. S. District Court in SF last Friday, Stanford (and Cal, and Harvard) alum Judge Donato is presiding. There's a proposed class action suit waiting in the wings.

The cases are Vanipenta v. SVB Financial Group et al., case number [/font][/color]5:23-cv-01097, Snook v. SVB Financial Group et al., case number 3:23-cv-01173 and Siddiqui v. Becker et al., case number 4:23-cv-01228, in the U.S. District Court for the Northern District of California

Orrick To Rep Ex-SVB CEO In Shareholder Suits
SVB now Silicon Valley Bridge Bank, N.A.

Silicon Valley Bridge Bank, N.A. in Operation – Details for Counterparties | Silicon Valley Bank (svb.com)

RE: Credit Suisse - TonyLima - 03-21-2023

Update: article postponed until Wednesday. Power a little sketchy here right now.

Wrong. Power stayed on.  Here's the link to my article.

RE: Credit Suisse - BostonCard - 03-23-2023

[tweet]https://twitter.com/underthenettle/status/1638128423380844545?s=46&t=tTMJoVUyV69NbVTC5DVNgw[/tweet]

Lol. … two assasinations… that “hinted at”… criminal origins.

BC

RE: Credit Suisse - rogpodge - 03-24-2023

[tweet]https://twitter.com/Jkylebass/status/1639251840872136704[/tweet]

Deutsche Bank next?

RE: Credit Suisse - Mick - 08-05-2024

Feds approved Silicon Valley Bank bankruptcy plan, but have kicked the $1.93 billion FDIC dispute to district courts.

SVB Bankruptcy Plan Approved, But $2 Billion FDIC Fight Lingers