New details have emerged regarding Silicon Valley Bank (SVB) and the events that led up to its collapse — revealing that the bank had consistently doubled down on its embrace of far-left diversity policies over actually doing its job, and lost hundreds of millions of dollars in the process.
If you just lost millions in the Silicon Valley Bank – don’t worry – they really pushed climate change, equity, and the woke agenda.
You final got to put your money where your mouth is. A small price to pay to save the planet and coddle woke children.
— Catturd ™ (@catturd2) March 11, 2023
The Daily Mail described the situation perfectly in the title of a recent article, writing: “SVB hired board obsessed with diversity, invested $5BN for ‘healthier planet’ and held month-long Pride celebration – but had NO chief risk officer for eight months last year.”
For eight months of 2022, while continuing to push a woke agenda, SVB did not have a chief risk operator — and spent that time period investing clients’ money in low-interest government bonds and securities.
After the Federal Reserve increased interest rates, the value of the bank’s assets fell while their customers tried to withdraw funds.
Now, a new report from Just The News revealed details from a transcript of an investor call that took place last July, during which some major investors voiced their concerns about SVB prioritizing politics over investors’ returns.
During the call, SVB representatives bragged about the bank’s diversity, equity, and inclusion (DEI) measures, as well as the company’s commitment to gay pride. Meanwhile, J.P. Morgan official Steve Alexopoulos demanded SVB explain the particularly devastating losses in a specific quarter.
“So if we look at the $137 million of investment losses, which are detailed on Page 7, that declines a bit more than we’ve seen in other periods, right, is over 8%, typically you’re like 2% to 3%,” the J.P. Morgan official said. “Can you walk us through the three buckets, so we can understand that a bit better?”
SVB President and CEO Greg Becker evaded the question in his response, stating: “I believe, and I certainly hope we’ve kind of gotten down to the floor. No guarantees, but this is just a flavor for how we’ve approached the securities portfolio.”
After the collapse over the weekend, SVB was forcibly placed under the Federal Deposit Insurance Corporation’s (FDIC) control, and the CEO is now facing several lawsuits over his mishandling of investors’ finances.
SVB’s collapse is being reported as the second-largest bank failure in American history, with the 2008 financial crash being the first. SVB was estimated to have at least $209 billion in assets at the time of the collapse.
Critics have blamed financial mismanagement for the bank’s collapse, citing far-left politics as having contributed to the failure and incompetence because SVB prioritized political agendas over smart financial decisions.
“We knew it was financially mismanaged, but oh my gosh, this is probably the most woke bank in existence of mankind — or it was the most woke bank,” said Joel Griffith, financial fellow at the Heritage Foundation. “We should recognize the primary cause of this bank going belly up was just gross financial mismanagement.”
“They took depositors’ money, and they put this in long-term debt investments at record low-interest rates, and as any financial risk manager knows, if you have interest rates that increase, the value of those debt assets are actually going to decline,” Griffith added.
Meanwhile, SVB’s collapse has sparked at least two more banks to collapse: Signature Bank in New York, and Silvergate Bank in California. The resulting plunge in the banking industry’s stock value since Monday has prompted concerns that the current recession in the U.S. could grow worse.