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BANK3011 Individual Assignment Instructions S2 2025
1. Due Date
Friday, 24th October 2025 23:59 (Week 11)
2. Academic Integrity and AI policy
This is an individual assignment where students are expected to work independently on the
assignment tasks. The similarity of assignment answers will be checked in Turnitin. Any
plagiarism, collusion and other dishonest conduct will be penalised subject to the university
Academic Integrity Policy. You are highly recommended:
• to keep your workings beyond the access of the other students,
• not to share your document by any means with any other students,
• not to attend any private tutoring sessions on this assignment and
• not to use any assignment help services from a third party.
You are encouraged to use AI tools to support your academic work on this project. Please ensure
that any use of AI is appropriately acknowledged in line with University policy.
The BANK3011 teaching team is keen to help. Please do not hesitate to contact the tutors and
lecturer for supports.
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3. Assignment Tasks
The 2023 Silicon Valley Bank collapse was the third-largest bank failure in United States
history and one of the two largest since the 2008 financial crisis. The purpose of this study is
to examine the factors that led to the failure and to reflect on broader lessons for effective bank
risk management.
Section 1: Background and Financial Health of SVB (5 marks)
Task 1. Background (around 100 words, 2 marks)
Provide a concise overview of Silicon Valley Bank (SVB). Your summary should cover the
following aspects: the bank’s history and its primary location of operations, its core business
model and customer base, its industry position prior to the collapse and its competitive
advantages relative to peer banks of similar size. The sources of information must be properly
acknowledged.
Task 2. Financial Performance of SVB 2022 (around 150 words, 3 marks)
Fill in the table below using information from SVB’s 2022 annual report. Present the completed
table in your answer. Then, based on the ratios presented in the table, provide a commentary
on SVB’s overall financial health in 2022, focusing specifically on profitability, asset
composition, and capital adequacy.
SVB 2022 Mid-size banks average 20221
Net Interest Margin 3.34%
Return on Assets 1.25%
Net loans/Total assets 61.88%
Tier 1 leverage ratio 9.41%
Tier 1 risk-based capital ratio 13.07%





1 The benchmark ratios are provided by FDIC BankFind Suite (https://banks.data.fdic.gov/bankfind-
suite/).
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Section 2 The Asset Allocation of SVB (17 marks)
One important reason for the failure of SVB is its excessive investments in interest sensitive
securities. In this section, you will analyse the asset composition of the bank to develop a
sensible understanding on this issue.
Task 3. Visualise the changes in SVB’s asset allocation (3 marks)
From the annual financial reports of SVB, extract the values of investment securities2 classified
as Available-for-Sale (AFS) and Held-to-Maturity (HTM) for the four-year period from 2019
to 2022. Plot a graph showing the changes in SVB’s investments in these two categories of
securities during this period. Note that simply presenting raw values may be misleading, as
changes could reflect shifts in the overall balance sheet rather than the bank’s allocation strategy.
If you process the data to allow meaningful comparison across years, clearly describe your data
preparation procedures below the graph. You are not required to analyse the data or provide
any interpretation of the graph at this stage.
Task 4. AFS vs. HTM (around 150 words, 3 marks)
Assume that SVB holds a portfolio of securities whose market value declines by $100 million
during the year. Explain how the accounting treatment differs when these securities are
classified as AFS versus HTM. In your answer, discuss how the $100 million loss would affect
the reported value of total assets and net income under each classification.
Task 5. The yield curves (around 150 words, 5 marks)
Visit this webpage on the website of the US Department of the Treasury.
• Visit the U.S. Department of the Treasury’s website (this webpage) and retrieve the
Daily Treasury Par Yield Curve Rates for January 2, 2022, and December 30, 2022.
Plot both yield curves on the same graph. Make necessary adjustments (e.g., aligning
time units and removing missing values) before plotting the graph. Label the graph
clearly.
• Discuss how the observed changes in the yield curve would affect the value of securities
held by SVB. In your discussion, explain which segment of the yield curve—short-term
(up to 1 year), medium-term (more than 1 year but less than 10 years), or long-term (10

2 This information is usually reported in the notes to the financial statements. For example, the relevant
note for investment securities is Note 9 on pages 123-129 of SVB’s 2022 annual report.
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years and above)—was likely to have influenced the market value of SVB’s holdings
of fixed income securities most significantly.
Task 6. The interest rate risk management of SVB (around 400 words, 6 marks)
• Drawing on your knowledge and further reading of financial reports or related literature,
introduce the strategies SVB undertook during 2022 to manage the impact of rising
interest rates on its reported net income and securities portfolio.
• Based on related literature and financial report information, explain why these risk
mitigation measures ultimately failed to prevent SVB’s collapse in 2023.

Section 3 The Liabilities of SVB and the Collapse of the Bank (8 marks)
Task 7. The liabilities of SVB (around 100 words, 3 marks)
Based on your review of financial reports and further literature, examine whether SVB’s
depositor base displayed demographic, geographic, or industry concentration. To what extent
their deposits were insured by the Federal Deposit Insurance Corporation (FDIC)?
Task 8. The bank run (around 200 words, 5 marks)
Explain why SVB was forced to sell its securities to realise the substantial losses in 2023. In
addition, discuss why SVB’s depositors reacted so quickly to the announcement of losses on
its securities portfolio. In your discussion, draw on insights from the literature on bank runs,
depositor behaviour, and liquidity risk.

Overall style and referencing (5 marks)
Style: You can follow a Q&A style to present your answers, and you don’t need to quote the
requirements in your final submission. You must label your answers to each part of the tasks
clearly (e.g. Task 1, Task 2, …, etc.).
Page limit: The maximum length is 10 pages, excluding the title page, acknowledge for AI uses,
reference list, and appendix. The word limits indicated for each section are indicative only, and
reasonable variations are acceptable. However, the overall page limit will be strictly enforced,
with a 10% deduction from the total available marks for each page exceeding this limit.
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Formatting requirements: Use 2 cm margins and 12-point font size. Times New Roman or Arial
are both acceptable. You may adjust line spacing to meet the page limit, but ensure formatting
is applied consistently throughout. Penalties will apply for poorly presented work.
Tables and figures: Tables and graphs must be captioned and clearly labelled. They should be
presented in the main body of the submission. If placed in the appendix, you will lose all 5
marks.
Referencing: You are expected to use academic references to support your analysis and
arguments. Citations and the reference list must be prepared following APA 7th or Harvard
referencing styles (https://libguides.library.usyd.edu.au/citation).
Writing: The logic of your answers must be easy to follow. Submissions are expected to be free
of spelling and grammatical errors, and all terminology should be clearly defined.

3. Data resources
• Annual reports of SVB can be downloaded from Canvas or from the website of the
bank: https://ir.svb.com/financials/annual-reports-and-proxies/default.aspx
• US banking sector financials can be retrieved from FDIC BankFind Suite:
https://banks.data.fdic.gov/bankfind-suite/
• Yield curve information can be found on the website of the US Treasury:
https://home.treasury.gov/policy-issues/financing-the-government/interest-rate-
statistics
• Other economic and financial market information can be found on the Fed website:
https://fred.stlouisfed.org/

4. Marking Criteria
The criteria below will be followed when marking each part of the assignment (including in
assessing the overall quality of the report):
i. The extent and quality of critical reasoning/critical thinking
ii. The demonstration of knowledge of relevant theory.
iii. The successful usage and interpretation of relevant data
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iv. The extent to which the work is clearly and concisely presented.
Weighting of marks:
This assignment will be marked out of 35 and scaled to contribute 25% of the total course mark.

5. Submission
The submission link will be released in Week 10 and further submission instructions will be
announced to students during the same week.

学霸联盟