1. The stability and dynamics of a bank’s deposit base and depositor concentrations must always be top elements for consideration in any assessment of banks.
2. Europe’s bank regulatory framework is a factor of strength for the sector, not an impediment. Regulatory relaxation and bank lobbying to achieve it can easily lead to unpleasant outcomes.
3. Banks in difficulty will never find it easy to raise new equity. The best avenue for a bank to stay well capitalised is to preserve and grow what it has rather than rely on future market issuance. Banks should think long and hard when it comes to share buybacks.
4. Smaller banks more vulnerable in new era of digital runs. SVB was the first major bank run of the digital age, occurring mainly out of the limelight of images of worried customers queuing at branches. Smaller and insufficiently diversified second and third-tier banks are vulnerable. Supervisors need to sharpen their tools to anticipate and prevent bank runs custom-made for the digital age, perhaps via future stress tests.

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