Reply With QuoteThis'll only go one way in here & there's already a thread in the Bear Pit.
https://forum.tz-uk.com/showthread.p...-SVB-the-start
So a "tech" driven bank based in the U.S.A. goes under and we in the U.K. get asked to bail out its clients .
Am i missing something here ? or is the good old U.K. taxpayer going to be putting their hands in their pockets again .
This'll only go one way in here & there's already a thread in the Bear Pit.
https://forum.tz-uk.com/showthread.p...-SVB-the-start
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Jim.
YesOriginally Posted by Jega
Seems to me they need to protect the many tech companies based in the uk that provide jobs and keeping us competitive in the world. However I’m no expert. Just can’t believe it was in such bad shape.
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Really I think we have to let them fail. It is the function of the monetry system that these deposits are uninsured liabilities on the bank's balance sheets. SVB is not a major bank and if we always bail them out it sets a precedent for irresponsible risk taking among the smaller banks that aren't subjected to the regulation of the major banks and these events will keep happening.
I don't see contagion risk at this stage. It may become a problem if depositors at other smaller banks also get nervous and withdraw but from what I've read this shouldn't be necessary due to the uniquely horrendous risk profile of SVB's assets/liabilities. One reason they might get bailed out though is the highly connected custoemer base of SVB who can and no doubt will lobby hard...
Lots of posts on LinkedIn advising businesses to withdraw funds from banks on Monday am regardless of who they bank with so this will spread IMHO and governments will need to intervene to guarantee deposits.
Cheers Jim i hadn't seen that thread .
Well looks like HSBC have taken over the UK arm.
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Good news I reckon
U.S. banks are regulated by the Federal Reserve. In the wake of the 2008 economic crash, the Obama administration signed legislation to tighten the controls over banks, including raising bank reserve requirements. In 2018 Trump and republicans passed a bill to roll back many of those "Obama" controls. Hence 2023 and two bank collapses...so far.
No cost to US tax payers -> Banks pay more to FDIC -> Bank charge customers more -> Bank customers are tax payers.
Of course the tax payer pays in the end.
Got a Canadian branch which has been taken over by a regulator
Too much crap going on. Hard to follow all of it. Just know I have no money in it yet, but not sure if the Canadian taxpayer is going to cover any shortfalls
Credit Suisse next?
Wonder who's next??
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