The regulation of SVB doesn’t seem to have been particularly lacking. The shortfall is not very large and should be covered by asset sales and some fairly small industry levies.
What exactly is the moral hazard here?
The executives and investors should lose everything. That will send the right signal to other bank execs and investors. And regulators should make some minor changes to balance sheet requirements and perhaps insurance thresholds/charges.
What do we expect corporate depositors to learn, aside from that their deposits are never safe, which would crash the whole banking system?
I share your concern about moral hazard. What I think you’re doing is letting your desire of an idealized outcome eclipse consideration of the least-worst workable outcome, which is realistically all we can hope for.