On the first anniversary of the crisis last March, this month’s newsletter looks at the unique circumstances and mistakes that ultimately led to the failure of SVB and lessons learned. One of those lessons is to beware of lessons learned, especially when they are based on “flawed, post-mortem reviews,” as Fed Governor Bowman argued this month. Even if the Basel 3 Endgame proposal looks like it is headed for a delay, our bank treasury contacts tell the newsletter that bank supervisors are already tightening guidance. A particular NYC regional bank was likely a victim of their new hardball approach. On a positive note, banks see stabilizing trends in their deposit balances and pricing and uninsured depositors are not in crisis mode anymore. However, most also believe that unless rates go back to 0%, depositors are not going to shift back to checking levels held as recently as two years ago, when noninterest-bearing deposits in the system equaled 30% of total deposits, compared to 23% last quarter.

Subscribe to The Bank Treasury Newsletter and Podcast at thebanktreasurynewsletter.com for professional Insights and commentary on bank treasury issues, investment portfolio strategy, and more. Listen on Apple Podcasts, Spotify, and Amazon. Follow us on LinkedIn.

Music by Phantom Sun.