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As a former Prudential Banking Regulator, I approve this explainer. Great job as always Richard.

Still the best in the KZfaq financial space. Real, clean information that is easily digestible.

As a former banker - your video was excellent and rare to be found on KZfaq. Another point you should have brought up is that the regulatory rules in the US are different from the global Basel rules that make comparing US/non-US banks. In the end the government will backstop all banks..

Every now and then, I watch a video like this one and am reminded of just how far down the rabbit hole we really are. Imagine starting a conversation in any other context with the phrase: "You've probably seen one of these articles about the massive unrealised losses of US banks." I'd imagine it's the inverse of the time a friend tried to explain to me what a Vanderpump was.

as an electrician, after the first 10 minutes, I was completely over my head. I am glad that you post these and most of the time , I get it. Seems like we don't have to worry, right?

I remember when LIBOR was found to be problematic and no one wanted to do anything because fixing the problem will impede underwriting profits… good times

As a finance major your videos are great for staying up to date in the industry

Thanks for all your insight, Richard. After watching your videos for nearly 3 years, I've finally managed to get somewhere compared to the big meme stock days 😂😊

This was a very fun video! I would love to see other videos featuring spreadsheets breaking down topical issues in the financial and business world

As a Canadian KZfaqr, can you give some insight on TD Bank and how it is the most shorted bank? And how does this affect the average investor who is not in Canada?

Excellent video!! I was just wondering about this very topic for these “too big to fail” banks. Thank you for being an amazing educator!!

fav YT channel by far, thx for sharing your insights

Love these more technical videos. Been a fan for ages, learned a lot from you, also really enjoy your goofier videos, but seeing analysis like this in practice is a different beast entirely and I'm so here for it

Thanks for this excellent and informative video! By far the best explanation I have seen regarding the current banking situation. It would be great if you could delve further into the situation of the regional banks.

I love this content! Please make more videos with spreadsheets, the educational value of this is insane!

Excellent video. Glad I subscribed.

Great content, was really informative! Thank you!

I just prepared a report on the same thing for my bank. I must say you covered it really well. Top tier knowledge

Easily the most informative media piece on the current banking situation ANYWHERE. Thanks for this awesome breakdown, Richard.

Very helpful visuals and terms explained PB!

Why does Canada get "housing crash imminent" fear articles every other week since 2008? If they haven't been right since 2008, is it only a matter of time? What do you think of the most recent scary articles about TD? From what i see, its a bunch of shareholders on both sides of the TD/First Horizon that just don't like that deal.

Question, a lot of this is rating-based, how accurate is the rating? I'm just thinking of the '08 crisis where ratings were laughably and devastatingly deceiving. I know it's completely different rating but just wondering.

This video was a hard throw back to intermediate accounting, lol. Great video!

Fantastic information, explained clearly. Great work, and thank you.

Another amazing and interesting video dear sir . All these subjects are a black box for common people but you make them easier to understand.

Another great video. thank you richard for this amazing breakdown.

Quite technical one, thank you 👍

Super informative! Thanks

I remember when the pandemic started the big banks did a stress test to see if they were in sound shape, and only Wells Fargo had to change anything from this test. Doesn't mean banks are perfect, but big banks are definitely different.

Awesome explanation Richard, backed with numbers to demonstrate. Thanks!

Great video, thank you.

Excellent content, thanks Richard.

Really solid video, Richard. Nice work.

Well said, thank you Richard!

An excellent take on the issue Richard. Top notch content!

lovely video mr plain bagel, love the dd. This hits the heart. Curious to see FRC's CET1 Capital

A few comments / additions (1) CET is really about measuring credit risk (and yes that is likely the biggest shortfall of bank regulation). The very design of that ratio encourages investment in govies given the 0% risk weighting (= no equity requirement). There is indeed no consideration for duration risk in equity capital rules at present. I think the idea was that deposit insurance would cover this, but that is a bit debatable, especially as there is no penalty for deposit conversion. (2) svb is sort of an example of how the banking (and fund/insurance) sector is absorbing rate increases from the government debt stack. (3) the real crux (in europe especially) that is still largely ignored are fixed rate mortgages / loans on the books where no mtm losses are taken. Especially mortgages in europe span 30+ years 9n fixed rates. Now European regulators say that these banks hold cet against these. While that is correct, the Cet is meant to cover credit losses on a PoD x LGD basis, not rate risk. Thus a combination of higher credit losses and deposit withdrawal would be quite critical

Solid content

Nice explanation... clear and simple

after spending too much time on twitter im happy to an economics commenter who is not a hyperbolic doomsayer

Thanks for being level headed. We need more of that in this time of sensationalism.

Excellent video. I learned a lot about how banks work in 15 minutes.

Fantastic video ‼️

Thank you Richard. I would like to see a comparison between what we are seeing today and 2008. I think ‘08 was far worse, but curious what you think.

Great Video!

Excelent vídeo for sleep on this vacation!

Thanks from Vancouver!!

Thank you!

At some point high rates will kill banks profits, if people just stops borrowing; pretty sure that will also bring down the economy but interesting thought experiment

Great Video, Do the Canadian Banks Next!

Nice lighting in this video

Hey Richard, great video as always. Do you have any theories as to why JPM chase is the only of the big four banks projected to lose money with a 100 bps hike? The only plausible explanation I could come up with is fewer IPOs in a high interest rate environment, and JPM oversees the most IPOs out of the big four.

I am Impressed!! You beat Patrick Boyle with explaination of the issiue with SVB. Taking in the account that your video is late, there is a even. You both nailed it. I really apreciate it.

As someone who uses BAC I feel very uneasy after your video with their unrealized losses. I wish they did better management knowing their terrible past and their less than recommended services, apps, and phone assistance.

Mr. B. Informative video as always. For a fictionalized read of bank runs (which are almost life-like) I would recommend Noble House by Clavell or The Count of Monte Cristo by Dumas. Nothing in the minds and banks of mankind is so new that it hasn't been done or thought of before. All the best. Thanks again.

It’s really no surprise JP Morgan is the best of the bunch, regardless of your opinion on Jamie Diamon, he is the Napoleon of modern banking

finally a reasonable video on the topic 👍

Loving the excel blackout for presentations! Thinking of using it myself if that's ok!

Channel that im looking forward to for new vids ✨

I hope I can find a finance/investment advisor with Richard’s qualities. Richard, I know that you like to keep your Investment Advising/Analysis and KZfaq profession separate (which I admire you for), but if you could recommend some Advisors in the US I would love to have a consultation meeting and see if they’re a good fit.

Great video Richard, I have yet to see anyone do this high level and in depth work on the uninsured deposit percentage/HTM issues of the major banks. Would you be able to share links to your sources as I have struggled to find some of this information on my own.

1st youtuber I have seen explain it properly ie. Gsib, hqla and basel 3. Nice!

Oh a little Hill Streets Blues reference at the end. Nice.

As someone who's studying for the series 65 I love this content

Can you make a basics of interest rates and inflation video pleaseeeee, i want to understand how Interest rates work ukwim ? How they are determined and what affects them and everything…maybe there’s more but i can’t articulate it…would love to see you curate something around the lines of basics of economics ! xoxo

So how do we square the value that regional banks provide in serving underbanked areas (e.g. regional banks were more efficient than national banks at covid relief fund distribution, per the Federal Reserve) with their relatively high susceptibility to bank runs? Does the FDIC cover this well enough that it's irrelevant in most cases and SVB is an outlier? It's pretty easy for the average person to use a "Big Bank" today through online banking; I use CITI for credit and checking and have never been to a physical branch. Are regional banks even necessary if they carry so much systemic risk?

The part that I’m wondering about now is how much of the interest hedging derivatives the banks are holding (if any) are centrally cleared. The counterparty risk of derivatives was considered to be a contributor to both the real and perceived risk of contagion in 2008. Any sort of large scale liquidity panic could be be up seeing that become relevant again. Is there any risk calculation based on that in the accounting of derivatives/hedging that were referenced?

What effect do you foresee this having on lending? I presume the banks will just hold until maturity and will end up fine. But they will be left in a more precarious position and with less capital available. Do you think this could have impacts on liquidity and the ability to raise capital in the wider economy?

Investors and other stakeholders of these banks just need to figure out what are the probabilities of these unrealised losses turning back into profits and the capacity of these banks to operate even if they have to book those losses.

Mr Bagel please do a video on the gold mafia from the aljazeera documentary

Can you do one on the canadian banks?

Isn't another issue of being stuck in 2% yielding 10 year maturities the fact that savings accounts need to offer more than 2% at this point in time, paying out more than they receive for the 10 year bonds? Even if they don't have to sell the held to maturity bonds, this seems like a serious issue to me, since they are would be locking in losses for the next 10 years, unless they don't take on savings. Am I missing anything here? Is there any way to mitigate this issue for banks?

I'm curious to know your take on TD bank with the recent news regarding how its the biggest bank being shorted in the US economy. I didn't know how big they are in the US.

Hi! thanks for the explainer. What makes that JPM expects a loss by rising interest rates even tho that would generally be a positive thing for banks?

Weeks since major bank collapse: 0

Dude, I love this video BUT I need a second video explaining in details what all those things mean.

I like this type of videos! Mooooooooooooore

Please do a video on Canadian banks 🇨🇦🙏🏼

What I don't get is how you can have govvies booked as HTM, but then they still feed HQLA? Seems contradictory if you would adamantly avoid selling the bonds at steep discounts were rates to rise? And then chuck the BTFP on top of that for HTMs, surely you can't still classify those as HQLA?

Fresh bagels!

Epic to see a Canadian finance expert blow up on KZfaq

Maybe you could do a video on the differences between money market fund and money market accounts (the later being FDIC insured and at a bank rather than a broker, etc...) A lot of the WSB folk seem to think everything is of the 'fund' class while returns aren't much (if any) lower for the the insured accounts. They also seem to be under the impression that you cannot easily get money out of a money market account, but you can, the money market account rules are very similar to those for savings accounts (only 6 transactions a month, but of any size via free ACH transfer is pretty liquid, though banks don't even need to enforce that limitation any longer with the schedule D changes).

What does this mean for small-to-medium size banks or credit unions? Should they be avoided?

What books do you recommend to start trading?

Hey, I just saw a TikTok about IUL investing/insurance. Can you please do a video about what it is and if it’s any good?

If you compare those numbers with Canadian and European banks, are there big differences or are those comparable?

"Yes, that UBS" 😂

I think the small/regional banks are going to be in trouble. Problems with liquidity plus exposure to CRE. I think there is a plausible bail-in risk with them.

“3 weeks without a bank collapse” epic 😂😂😂

What do you think about the TD bank situation? Everyone is writing articles on it being the most shorted bank and even my parents are talking about it. Was just wondering if this panic is justified or just another situation of people click baiting titles for views.

Would you share the excel document?

Good Video! Appreciate it, but I have a question: IF and lets say IF the majority of the people withdraw their money from their bank account, and the banks just have 10-12% available capital for this, they will go bust, won't they? Greetings :)

The gap though, which JP Morgan’s CEO recently highlighted, is that treasuries carry a non-zero risk. These measures do not take into account interest rate risk and that needs to be addressed.

Quick question, where are these in the Financal statements?

You’re too honest. Made me sad😢

Where did you get this data from? I have a presentation to make for my class about the current banking crisis and need a source of reference. Thanks!

TD. Since you are Canadian, can you make one on TD quick?

Hank. Do you have a point with any of your LinkedIn posts?

So is LCR ratio the Liquidity Coverage Ratio Ratio?