By now (where in this case “by now” means barely four days after everybody woke up to the problem), the tale of SVB’s collapse is well understood.

As far as definitive postmortems of financial catastrophes go, this one was conducted and agreed very swiftly, commensurate with the rapidity of the bank’s implosion.

It was a remarkably simple story, but a few days on, some of the nuance is becoming clear, and I think a few things are worth a mention. Readers will doubtlessly agree.

In retrospect (and like all bad things) this fiasco was aided and abetted by poor policy and regulatory decisions. For once, I don’t just mean ultra-low interest rates and everything that goes along with them.

In 2019, the Fed and the FDIC permitted banks with less than $700 billion in assets to avail themselves of an exemption to a rule that mandated the inclusion of unrealized gains and losses in regulatory capital via “accumulated other comprehensive income,” or AOCI.

The idea behind including elements of AOCI was to provide an early warning regarding capitalization. Allowing some banks to opt out might’ve encouraged risk-taking, and from what I can tell, at least some concerned citizen groups suggested as much at the time.

Sure enough, Bloomberg reported on Monday that at some point in late 2020, SVB’s management spurned an internal recommendation that the firm reduce duration risk by investing a larger percentage of deposits (which the bank was inundated with at the time) in short-dated fixed income.

The problem with that recommendation was that implementing it would’ve reduced earnings. Back then, shorter-dated bonds didn’t yield much, if they yielded anything at all.

So, again according to Bloomberg’s reporting, executives “continued to plow cash into higher-yielding assets.” That was good for profits, but when rates surged last year, so did unrealized losses on some of those securities. (As a side note, it was Goldman who bought SVB’s impaired AFS portfolio last week, according to The Wall Street Journal.)

Although management began to hedge last year, repeated employee exhortations for the bank to reduce duration were ignored, or so said a source who spoke to Jennifer Surane, Tracy Alloway and Katanga Johnson, who noted that as a percentage of total assets, SVB’s highly rate-sensitive investment portfolio was 15 percentage points above any other major US bank. That, right there, was the problem.

But, as more than a few readers have pointed out, another problem was the Economic Growth, Regulatory Relief and Consumer Protection Act of 2018, which unshackled mid-sized lenders by “exempt[ing] some small and regional banks from the most stringent [Dodd-Frank] regulations,” as The Washington Post explained at the time.

At a signing ceremony which included a very happy Steve Mnuchin, one self-described “genius” said the new law was aimed at “roll[ing] back crippling regulations that are crushing community banks nationwide.” He went on: “We’re going to have to start looking at that also for the larger institutions.”