Bank Goes Woke, Goes Broke

America being America, and American politics being what it is, politicians who watched the Silicon Valley Bank implode have rushed out to blame it on the opposition party. Sen. Elizabeth Warren, who never found a regulation she did not like, blamed it on Donald Trump. After all, the Trump administration had loosened regulations on the banking system, ergo….

Of course, it makes very little sense to blame it on Trump. As it happened the SVB was among the most woke banking institutions in the country. It excelled in sustainability and environmentally friendly practices. And it hired for diversity, not for merit. It was the Biden era, on steroids.

In truth, we are anything but surprised that at the national epicenter for wokedom, a bank would have wanted to lead the way toward the brave new woke world.

Sadly, it failed to hire a risk assessment officer, someone who could evaluate the level of risk it was assuming in its bond portfolio. When that portfolio collapsed, it was left with insufficient assets to cover its deposits, or some such.

The Daily Mail, of all places, examined the wokery going on at the SVB:

Executives at Silicon Valley Bank focused on woke initiatives to increase diversity amongst its ranks and invest in startups promoting a 'healthier planet,' but failed to spot its glaring problems with investments as interest rates rose.

The now-failed bank had an A rating for its Environmental, Social and Governance policies according to the MSCI index after creating its own initiatives to 'advance inclusion and opportunity in the innovation economy' and investing in clean energy solutions over the past few years.

It even announced that it would invest a whopping $5billion by 2027 to support sustainability efforts, while its European offices held a monthlong Pride celebration and promoted 'safe spaces.'

But for eight months last year, the bank did not have a chief risk operator, as it invested clients' money in low-interest government bonds and securities.

Then when the Federal Reserve increased interest rates, the value of SVB's assets fell while customers tried to withdraw their money.

Now, many are slamming the financial institution for focusing too much on woke policies and not enough on its investments. 

Imagine that-- go woke, go broke. Again, the paper continues, the bank was more interested in trendy causes than it was in making money:

It said in its 2022 ESG Report that the bank strives to 'create a more just, equitable and sustainable world.'

Among the initiatives included in that report are a 'commitment to provide at least $5billion by 2027 in loans, investments and other financing to support clients' sustainability business.

'SVB's Sustainable Finance Commitment aims to support companies that are working to decarbonize the energy and infrastructure industries and hasten the transition to a sustainable, low-carbon, net zero emissions economy,' the report states.

As for its hiring practices, the bank championed diversity:

It also notes that the bank implemented 'a diverse candidate slate for US leadership roles' and introduced its first six Employee Resource Groups for Asian, black, Hispanic, LGBTQ, veteran, military and female employees.

Additionally, it 'introduced measurable diversity goals for its senior leadership positions to strengthen the hiring and talent development initiatives meant to create paths to professional advancement, especially for women, black/African American and Hispanic/Latinx individuals.'

The report then goes on to note that the bank even created its own program 'designed to advance inclusion and opportunity in the innovation economy, particularly for women, black/African American and Hispanic/Latinx individuals.' 

So, as the notably left-leaning progressives in Silicon Valley tout their virtue, they need to offer something like an explanation for why their beliefs, translated into policy, managed to staff their bank with everyone except a risk assessment officer.