The reason for their demise is precisely because they invested into long-maturity bonds, ignoring the fact that customers may want, someday, to get their money back in the short-term.
They chose these long-maturity bonds is because they were offering higher yields.
Now of course, seen from today, these yields are very small, but when they invested, it was at a time we were talking about zero or negative yields in many currencies.
I think you missed pronouns on this. The "it" was the interest they were paying to depositors. Which... is typically absurdly low. I don't have a reference on what the accounts paid out, but this has nothing to do with the assets that SVB held, but the liabilities they had to their depositors.
I'd be delighted to see what their accounts were offering.
And above 4M? (My recollection is most people are complaining about some absolute whale accounts.)
I'm also curious on the 4.9 being "high yield." You are right that most of us have things in a checking account that is often sub 1%. Every bank I've ever been to had easy ways to convert that to a higher number. Usually you had to use their card or some such. (Such that, I would still agree that 4.9 is high, but not absurdly so.)
And don't forget that the risk had emphatically nothing to do with that percent versus the treasure bonds. It was depositors withdrawing. Presumably to put their money somewhere with higher yields, if rational. More likely it was to get it out and put it somewhere with, again, sub 1%.
