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It's lost money on bonds as a result of having to sell those bonds due to deposits drying up from it's technology customer base - it's also what that says about funding position of a lot of that customer base.
That doesn't sound ideal - but again depends how much. It also depends if that has a large impact on ability to continue to pay the bills etc. I have no idea on things like that.
Surely there is something in the tank in terms of liquidity though - I'm not sure if they would have been able to draw on the RCF given it looks like the system wasn't processing withdrawals - but I don't actually know that. If they were virtually fully drawn a while back then in itself might have little direct exposure - valuations in the whole sector will however be hit.
Yes ultimately if the parent co is gone, there is little hope for the ringfenced UK bit.
Really no idea where this leaves Grow - this will take a lot of unpicking. That runs all the way from moderate impact, need to renegotiate RCF with another bank etc, through to loss of deposits and investee cash etc, right through to how do they run the business.
https://seekingalpha.com/article/4586342-svb-financial-today-wasnt-run-on-bank-it-was-sprint
Any run on a bank like SVB is always going to be faster - it isn't dealing with retail investors who 'draw' money out by standing in line - these are tech savvy electronic large corporate deposits that move and most will already have sprinted away
For retail depositors yes - i.e. if you have £85k deposited as an individual that should be protected - but that's probably not relevant really. I'm not sure about large corporates etc. they receive virtually no protection anyway as such. So any additional protection would depend on how that ringfenced UK bank was capitalised - that's something I have no idea on. Regardless this looks like it could have a massive impact - much wider that those with deposits etc.
Always better to remove as you never know. In those events the normal rules don't apply and people will save their own skins first, with little regard for others or the rules - it happens.
I recall that sinking feeling when your withdrawal doesn't arrive (way before public announcements) from a bank (Icesave) - I was taking the money out to pay for something and it wasn't a small sum - eventually got it back - in like 3 months or so - stopped me purchasing what I was purchasing.
love that line 'some VCs have urged calm' - yes whilst they run as fast as they can to get all of their money out before others!!
ok - I wasn't aware of that. I would imagine a fair few technology players do. I would also imagine they are very busy doing what they can to withdraw their funds immediately.
We don't know if they have funds on deposit, there is nothing to suggest they do, other than the fact they have a relationship with SVB by way of the RCF. Most companies use a number of banks and should be spreading risk appropriately. SVB is a regional bank so I wouldn't expect Grow to have much on deposit with them - but I could be wrong. I would expect a statement if they do. What would concern me is if any portfolio companies use SVB - I have no idea on this - it isn't publically available information, but SVB are technology focused.
Always the same with bank runs. I think SVB is gone.
I had actually forgotten that Molten has it's RCF in part with SVB. Just checked now, JP Morgan and SVB.
Even bigger issue for those tech companies with funding deposited there - to withdraw or not, no one wants to be last out of the door as the safe will potentially be empty. One of the larger banks will pick SVB up for cents on the dollar I would imagine. Short term however this could well cause difficulty for many companies that are reliant on SVB. I expect we will wake up to some sort of solution tomorrow.
There are going to have been a lot of very late nights in Silicon Valley and at SVB last night. It looks like SVB might not survive - who knows, I think it would likely be rescued anyway. Either way some significant market falls today, particularly in the technology space.
That's partly tax related - taxes everywhere will be following on the road up however. Investors are more willing to embrace boom and bust in the US....accepted as the journey to success sometimes, more so than it is here. Ultimately people IPO where they will get the most out of it. That's the US for technology probably. or it was.....I think the Nasdaq will fall another 10-20% yet. We shall see.
I know this is off topic, but it was only last week that the CEO of Wandisco was talking about a dual listing with a New York float and the blow this dealt to the UK market (where it would maintain it's listing). Around £9m of revenues and a market capital approaching £1bn. All of that valuation based on future order book - I would never purchase £9m of revenue today for that price - and today it is essentially worthless. There will be no US listing, rather fraud and a likely complete loss for investors. A lot got over pumped in the folly that was the Covid technology boom and they haven't all been found out yet. Some will go on to be decent companies, a miniscule amount will go on to great things, Revolut might well have longevity - not sure on that yet - it's the valuation that left no room for delays or errors etc - or for that matter no further gains at the price it floated at. Presumably Cazoo went to the US as it could get the float away at a higher price - now it's valued at 1% of the original value. So maybe teh UK becomes more'marginal' - I'm not quite sure what that means. If it means that the market and the participants apply a greater level of scrutiny and doubt to over-hyped valuations (so they go elsewhere) then that is no bad thing in my book. In the end a significant amount of equity return comes in the form of dividends and surplus cashflow - the UK still has plenty of that.
I would just get a Platinum Amex if I wanted the travel benefits - not interested in Crypto. My investment accounts are with very strongly capitalised players - that administer ISAs and SIPPs very well meaning I get full tax benefits and administration on overseas shares etc. I have yet to see a reason why I would want to pay for a bank account or credit card for that matter......
I have no idea what an Ultra account is but I will take a look.