I must admit that I don't spend a lot of time on HN defending banks, but I'm not sure what they are supposed to have done wrong in this case. A commercial entity wants to borrow money and they have plenty of assets to cover the loan if it goes bad - not the bank's fault they were bad at investing.
Well the bank would normally be on the hook for making the bank loans. Unless it bought insurance then it would only be on the hook if the insurer failed. Luckily they had buddies at the fed/ government to ensure this insurance was paid out at the full 100 cents on the dollar.
