Abstract

In March 2023 two governments met the trouble of a large bank with different instruments. In the United States, Silicon Valley Bank was closed on 10 March and the FDIC named receiver; on 12 March the Treasury, the Federal Reserve and the FDIC announced that all its depositors would be protected. In Switzerland, the Federal Council issued an emergency ordinance on 16 March on extra liquidity loans of the Swiss National Bank to systemically important banks, backed by a federal guarantee, and amended it on 19 March to add a guarantee against losses for a bank taking over another. This article asks how these documents set the guarantee and the loan, and how the sums announced differed from the sums that could be used. It reads the four primary texts at length, the Swiss ones in German, beside two modern summaries of the episodes published by Skeptron, a studio of the RISCON family, and a ledger built on those summaries. The American texts promise depositors their money from a named Monday, give the bank's size but no sum for the protection, name who will not be protected and who will pay, and give no end. The Swiss texts name no sum for the loans, set them out as a ladder whose rungs open only when the one below is used up, state a term of six months, and cap the loss guarantee behind a first loss borne by the acquiring bank. The modern summaries keep the sums and drop the term and the payers. The article joins two debates, on whether a guarantee or a loan stops a run and on whether rescue rules must be set in advance, and settles neither.