WDecision ArchiveEvidence before outcome
Part BOutcome & teaching note

Funding Liquidity · 2019–2023

Silicon Valley Bank

No specific May 9, 2022 joint-committee action is established by the captured public record; later evidence shows exposure persisted, March 8 actions were announced, a run followed and the bank entered receivership.

Outcome chronology

At year-end 2022 SVB reported USD 211.8 billion of consolidated assets, USD 120.1 billion of investment securities, USD 173.1 billion of deposits and USD 16.0 billion of stockholders' equity. It separately estimated USD 151.5 billion of uninsured U.S.-office deposits and reported fixed-income portfolio duration of 5.7 years. The latent funding and rate exposures therefore predated the final run. claim.svb.outcome.year-end-fragility table.svb.outcome.2022-position source · svb.outcome.2022-10k

On March 8, SVB disclosed that it had sold approximately USD 21 billion of securities, expected an approximately USD 1.8 billion after-tax loss and intended to raise approximately USD 2.25 billion. The capital raise was an intended transaction, not completed capital. claim.svb.outcome.march8-actions table.svb.outcome.march-sequence source · svb.outcome.march8-actions

DFPI reported that depositors initiated USD 42 billion of withdrawals on March 9 and that the bank ended the day with an approximately USD 958 million negative cash balance. California closed the bank on March 10 and the FDIC became receiver. claim.svb.outcome.run claim.svb.outcome.closure source · svb.outcome.dfpi-possession-order source · svb.outcome.bank-closure-8k source · svb.outcome.fdic-closure

The March 8 actions were a confidence trigger and communicated stress, but one securities sale is not a sufficient explanation. The duration and funding concentration existed before the announcement; the run explains the acute timing; deficient liquidity planning helps explain why withdrawals could not be met. claim.svb.outcome.trigger-not-sole-cause hypothesis.svb.outcome.multifactor source · svb.outcome.2022-10k source · svb.outcome.march8-actions source · svb.outcome.dfpi-possession-order source · svb.outcome.fed-review

Resolution perimeter

The joint government response protected depositors but did not rescue shareholders or certain unsecured debtholders. SVBFG later entered Chapter 11 separately from the bank receivership. First Citizens acquired the bridge bank's deposits and loans and about USD 72 billion of assets at a stated USD 16.5 billion discount, while roughly USD 90 billion remained in receivership. Those terms include a defined perimeter and cannot be converted into a simple enterprise value. claim.svb.outcome.systemic-response claim.svb.outcome.holding-company claim.svb.outcome.franchise-value table.svb.outcome.first-citizens source · svb.outcome.systemic-risk-statement source · svb.outcome.holding-company-ch11 source · svb.outcome.first-citizens-sale

Bank closure, holding-company distress and common-equity destruction were catastrophic. They do not prove that every loan, client relationship or operating capability had zero value. claim.svb.outcome.failure-perimeter source · svb.outcome.bank-closure-8k source · svb.outcome.holding-company-ch11 source · svb.outcome.first-citizens-sale

Causal assessment and rivals

The best-supported account is layered: concentrated and largely uninsured commercial funding plus lengthening securities duration created fragility; higher rates and weaker technology fundraising pressured asset values and client liquidity; management's hedge and liquidity decisions increased exposure; the March 8 loss and proposed raise crystallized concern; a networked run overwhelmed cash and collateral; and slow supervisory escalation reduced the time for remediation. The official Fed review is important primary postmortem evidence, but it is a self-assessment with a defined remit, and GAO called its own findings preliminary. claim.svb.outcome.fed-causal-findings evidence.svb.outcome.gao-limit source · svb.outcome.fed-review source · svb.outcome.gao-review source · svb.outcome.reuters-explainer

The “rates and technology downturn alone” rival cannot explain SVB-specific funding and duration choices. The “bond sale alone” rival mistakes a trigger for the entire vulnerability. The “run alone” rival explains speed but not the inability to withstand it. The “management alone” and “supervision alone” rivals each omit the other layer. No single source proves precise causal weights. hypothesis.svb.outcome.macro-only hypothesis.svb.outcome.sale-only source · svb.outcome.2022-10k source · svb.outcome.march8-actions source · svb.outcome.dfpi-possession-order source · svb.outcome.fed-review

Ex-ante signals and counterfactual

Cutoff-valid signals included USD 166.0 billion of estimated uninsured U.S.-office deposits, a sector-linked commercial funding model, a 5.2-year HTM duration, a 30.4 percent modeled EVE decline under +200 basis points, and contingent borrowing capacity that had not been established as operationally drawable in this public packet. Each has false positives: uninsured does not mean immediately runnable; duration can be economically held; static EVE models are assumption-sensitive; nominal facilities may be drawable. The appropriate response was validation and staged resilience, not a prediction of imminent failure. source · svb.cutoff.2021-10k source · svb.cutoff.q1-2022-10q

The feasible counterfactual is the Part A program: preserve controlled execution while hedging duration, testing borrowing channels, diversifying funding and measuring network-correlated deposit cohorts. The sources do not support a deterministic estimate of how much loss it would have prevented or whether it would certainly have stopped the run. counterfactual.svb.outcome.staged-remediation source · svb.cutoff.finance-charter source · svb.cutoff.q1-2022-10q source · svb.outcome.fed-review

Candidate agent rules

  • Treat uninsured deposit share as a funding-risk input, never as an assumed one-day runoff; add controller and network correlation. rule.svb.deposit-correlation
  • Reconstruct time-to-cash after collateral haircuts and operational constraints; nominal liquidity is not drawable liquidity. rule.svb.operational-liquidity
  • Separate trigger, structural vulnerability and amplification in causal analysis; do not say one bond sale alone caused a bank failure. rule.svb.layered-causality

These are candidate rules from one case. They require cross-case testing, counterexamples and false-positive calibration before promotion. source · svb.cutoff.2021-10k source · svb.cutoff.q1-2022-10q source · svb.outcome.fed-review

Boundary conditions

Do not infer that every specialized bank is unstable, that all uninsured deposits will run, or that every HTM fair-value decline is a realized loss. Do not equate AOCI, HTM marks, tangible equity and regulatory capital. Do not infer that depositor protection was an equity rescue. Do not infer enterprise value by subtracting a stated transaction discount from acquired assets. And do not let March 2023 run speed erase the duration and funding decisions observable before it. source · svb.cutoff.2021-10k source · svb.outcome.systemic-risk-statement source · svb.outcome.first-citizens-sale

Observed after the cutoff

Outcome financials

3 tables

Later values do not backfill Part A. Definition changes, unknowns, and derived endpoints remain labeled.

Year-end 2022 consolidated positionAs Reported At Horizon · USD_millions
MeasureDecember 31 2022
Total assets211,8001
Investment securities120,1001
Deposits173,1001
Stockholders equity16,0001
USD · USD_millionsReported values remain strings; no browser-side recalculation.
March 8–9 reported amountsAs Reported At Horizon · USD_millions
MeasureAs reported
Approximately sold securities21,0001
Expected after-tax loss1,8001
Intended capital raise2,2501
March 9 withdrawals initiated42,0001
March 9 closing cash balance-9581
USD · USD_millionsReported values remain strings; no browser-side recalculation.
First Citizens transaction perimeterAs Reported At Horizon · USD_millions
MeasureMarch 26 2023 announcement
Assets purchased72,0001
Stated discount16,5001
Assets retained in receivership90,0001
USD · USD_millionsReported values remain strings; no browser-side recalculation.

Transferable—but not universal

Candidate decision rules

3 hypotheses

These rules are case-derived hypotheses. Each retains “unless” conditions, kill criteria, counterexamples, and promotion gaps.

Candidatemoderate confidence

rule.svb.deposit-correlation

Segment runoff by controller, channel and network; stress correlated cohorts without assuming every uninsured dollar exits immediately.

Insurance status affects incentive, while common liquidity shocks and communication channels affect correlation and speed.

Use when

  • A material share of deposits is uninsured
  • Funding is concentrated in economically connected commercial cohorts

Do not transfer when

  • Verified beneficial-owner and behavioral evidence demonstrates low correlation under severe stress

Reverse or kill if

  • Cross-case evidence shows insurance status and network segmentation add no predictive or decision value
Limitations and promotion gaps
  • One failure cannot calibrate a universal runoff rate.
Candidatehigh confidence

rule.svb.operational-liquidity

Calculate time-to-cash after haircuts, encumbrance, documentation, settlement and operational readiness; test the channels.

Nominal capacity can fail to become usable cash at the speed of a run.

Use when

  • A liquidity argument relies on facilities
  • collateral or securities monetization

Do not transfer when

  • The funding is unconditional immediately available cash

Reverse or kill if

  • Independent tests prove all counted capacity remains immediately drawable across severe scenarios
Limitations and promotion gaps
  • Public filings rarely expose operational detail; human approval is needed for funding assumptions.
Candidatehigh confidence

rule.svb.layered-causality

Model structural vulnerability, trigger, amplification and response as separate causal layers and preserve rival hypotheses.

A visible last event may accelerate failure without creating the balance-sheet and funding fragility that made failure possible.

Use when

  • A failure follows a salient financing or disclosure event
  • Pre-existing vulnerability evidence exists

Do not transfer when

  • Primary evidence establishes that the event independently created the full vulnerability

Reverse or kill if

  • Later primary evidence establishes a single sufficient cause and refutes material pre-existing mechanisms
Limitations and promotion gaps
  • The rule structures analysis but does not estimate causal weights.

Lineage

Complete case source ledger

18 records

This list combines decision-cutoff and outcome evidence. Each report citation resolves to a source ID below. Third-party documents remain with their original publishers.

T1

src.svb.cutoff.2021-10k

SVB Financial Group Form 10-K for year ended December 31, 2021

U.S. Securities and Exchange Commission · Mar 1, 2022

Regulatory FilingPrimaryContemporaneous

Used for: Cutoff-valid business model, deposit composition, uninsured-deposit estimate and year-end financial position · Accounting definitions and reported duration, liquidity and interest-rate-risk evidence

T1

src.svb.cutoff.2022-proxy

SVB Financial Group 2022 definitive proxy statement

U.S. Securities and Exchange Commission · Mar 4, 2022

Regulatory FilingPrimaryContemporaneous

Used for: Board allocation of enterprise risk, treasury and risk-appetite oversight · Contemporaneous governance structure and committee membership context

T1

src.svb.cutoff.q1-2022-results

SVB Financial Group first-quarter 2022 results and Form 8-K

U.S. Securities and Exchange Commission · Apr 21, 2022

Regulatory FilingPrimaryContemporaneous

Used for: Management's first-quarter performance narrative, NIM outlook and stated rate assumptions · Contemporaneous description of client-funds conditions and asset-liability positioning

T2

src.svb.cutoff.risk-charter

SVB Financial Group Board Risk Committee Charter

SVB Financial Group · Apr 22, 2022

Issuer DisclosurePrimaryContemporaneous

Used for: Exact Risk Committee duties for risk appetite, liquidity, contingency funding and interest-rate-risk oversight

T2

src.svb.cutoff.finance-charter

SVB Financial Group Board Finance Committee Charter

SVB Financial Group · Apr 22, 2022

Issuer DisclosurePrimaryContemporaneous

Used for: Exact Finance Committee duties for balance-sheet, capital, stress-testing and liquidity oversight jointly with Risk Committee

T1

src.svb.cutoff.fomc-may-2022

Federal Reserve issues FOMC statement

Board of Governors of the Federal Reserve System · May 4, 2022

Court Or Government RecordPrimaryContemporaneous

Used for: Cutoff-valid policy-rate path and balance-sheet-runoff signal for bank rate scenarios

T1

src.svb.cutoff.q1-2022-10q

SVB Financial Group Form 10-Q for quarter ended March 31, 2022

U.S. Securities and Exchange Commission · May 6, 2022

Regulatory FilingPrimaryContemporaneous

Used for: Last cutoff-valid balance sheet, AFS and HTM marks, duration, liquidity capacity and capital metrics · Issuer EVE and NII sensitivity scenarios with explicit static-balance-sheet and deposit-behavior assumptions

T1

src.svb.outcome.2022-10k

SVB Financial Group Form 10-K for year ended December 31, 2022

U.S. Securities and Exchange Commission · Feb 24, 2023

Regulatory FilingPrimaryContemporaneous

Used for: Year-end deposit, AFS, HTM, capital, AOCI, duration and liquidity position immediately before the run · Evidence of how the cutoff risks evolved before the March strategic actions

T3

src.svb.outcome.reuters-explainer

Explainer: What caused Silicon Valley Bank's failure?

Reuters, mirrored by Investing.com · Mar 10, 2023

Reputable NewsSecondaryContemporaneous

Used for: Contemporaneous market narrative of venture-community withdrawals, securities losses and capital-raise reaction

T1

src.svb.outcome.systemic-risk-statement

Joint Statement by Treasury, Federal Reserve, and FDIC

U.S. Treasury, Federal Reserve Board, and FDIC · Mar 12, 2023

Court Or Government RecordPrimaryContemporaneous

Used for: Government decision to protect all depositors while excluding shareholders and certain unsecured debtholders