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A comment on Big Banks Agree to Historic $30B Deposit Injection in First Republic. Parent comment

Re:Big Banks Agree to Historic $30B Deposit Injection in Fir... by KptMarchewa on Friday March 17, 2023 @09:05AM (#35196559)
What they did with SVB prevents this thinking. Make the depositors whole, wipe out shareholders, prosecute the executives.
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Re:Big Banks Agree to Historic $30B Deposit Injection in Fir... by Aaronontheweb on Friday March 17, 2023 @09:25AM (#35196771)
Not really - rewriting the rules (FDIC insurance limits) midway through because SVB's own depositors yelled "bank run!" loud enough is still moral hazard. Do I need to make sure I bank with an institution that Jason Calcanis, Mark Cuban, et al use so I can insure my deposits with their political / popular leverage?
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Re:Big Banks Agree to Historic $30B Deposit Injection in Fir... by criley2 on Friday March 17, 2023 @11:47AM (#35198632)
It's hardly a rewrite, everyone knows that your deposits with the big 5 are already 100% "too big too fail" anyway.

The only change is that some smaller organizations might also get the same unspoken benefit that the big 5 already enjoy.

This keeps them competitive, and as the US Gov and many folks noted, if they did not do this, everyone would flee to the Big 5 and regional/community banking would be wiped out.

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