RE:RE:Update on SVB Torontojay wrote: The maximum amount they could lose is US 55m =~ C 75.9m which is about $1.25/share. The share price could drop to well below $1 if they do not recover these funds.
It's a possibility.
I think the scenario where they lose everything is very unlikely.
The main problem of the bank was that they couldn't maintain liquidity minimums and were not able to raise money. Obviously, a liquidation is the worse kind of situation, but since it's financial assets they might be able to achieve 80%ish recovery. Considering the latest bank statements, that would mean a coverage of about 85-95% for the uninsured clients.
At least they have other liquidities to cover up the short term, but in the end losing money on bank deposits is quite a bad situation. Depending on the outcome, I expect $5-10M CDN loss unless the government bails the clients out. They may be able to recover some of that based on their business insurance.
Too bad since the Q4 numbers were encouraging.