SERS Benefits are SAFE – Exposure to Failed Banks is Small
While the news of the Silicon Valley Bank (SVB) and Signature Bank failures is newsworthy, please know that SERS’ exposure to those banks through investments was small. In total, SERS has experienced a decline in assets of $1,566,393; -$929,410 in SVB and -$636,983 in Signature. This represents 0.01% of our $17 billion fund.
The investments in SVB were made as part of an index replication strategy. This type of strategy replicates a segment of the stock market and the stocks in it are selected because they are part of that market segment. Because of SVB’s importance in handling investment transfers, they were included in that index.
Please be aware that incorrect and misleading data regarding SERS’ holdings in SVB are circulating. SERS had 3,976 shares of SVB with a total exposure of $929,410 from the point of purchase to this week’s markdown. We are working to clear up the misinformation.
These holdings represent a small fraction of SERS’ overall investment portfolio. SERS manages a diversified investment portfolio and our members’ retirement security does not hinge on the success or failure of these firms.