SVB Financial pressures ‘highly idiosyncratic,’ says Morgan Stanley

Morgan Stanley argues that the funding pressures facing SVB Financial (SIVB) are "highly idiosyncratic" and should not be viewed as a read-across to other regional banks, stating further that it does not believe there is a liquidity crunch facing the banking industry and that most banks in its coverage have ample access to liquidity. Falling venture capital funding activity and elevated cash burn are "idiosyncratic pressures" for SVB’s clients, which is driving a decline in total client funds and on-balance-sheet deposits, but the firm notes that it has "always believed" that SVB has more than enough liquidity to fund deposit outflows related to venture capital client cash burn. The firm keeps an Underweight rating on SVB Financial shares.