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1 . What is a run on a bank? Why is it impossible for a bank to survive a run on its deposits without outside

1.What is a run on a bank? Why is it impossible for a bank to survive a run on its deposits without outside financial assistance?
2. How does insurance by the Federal Deposit Insurance Corporation (FDIC) fill some of this need for outside financial assistance? Why did Silicon Valley Bank (SVB) have many depositors with balances beyond the FDIC insurance limit?
3. A related article, SVB Stock Halted After Sharp Selloff; Bank Exploring Possible Sale, states that
SVB ...said it would book a $1.8 billion after-tax loss on sales of investments.... According to
the description in this article, what were those investments?
4. Define the investment categories of held-to-maturity, available-for-sale, and trading. Cite your
source for these definitions from the FASB Accounting Standards Codification.
5. Based on the description in the article, what category of investments do you think that SVB was
forced to sell to satisfy its depositors demands to withdraw money? Explain your answer.
6. What are the accounting and disclosure requirements for the category of investments you identify in question 7? Cite the Accounting Standards Codification section that includes these
requirements.
7. Refer to the SVB Financial Group 10-K filing for December 31,2022(see notes above). Does it
appear that SVB Financial Group complied with the disclosure requirements? Explain your
answer.
8. How could changing the accounting for investments possibly help to avoid the problems that
developed at Silicon Valley Bank? Devise a recommendation and support your proposal with clear arguments that also may refute opposing arguments

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