The parent of the Silicon Valley bank seized by the US last week is filing for Chapter 11 bankruptcy protection.
SVB Financial Group, along with its CEO and its chief financial officer, was this week targeted in a class action lawsuit that claimed the company did not disclose the risks that future interest rate hikes could pose to its business. But will fall
SVB Financial Group is no longer affiliated with Silicon Valley Bank following its seizure by the Federal Deposit Insurance Corporation. Its collapse was the second largest bank failure in US history after the demise of Washington Mutual in 2008.
The bank’s successor, Silicon Valley Bridge Bank, continues to be operated under the jurisdiction of the FDIC and is not included in the Chapter 11 filing.
“The Chapter 11 process will allow SVB Financial Group to preserve value as it continues to make strategic adjustments to its prized businesses and assets, particularly SVB Capital and SVB Securities,” William Kostouros, SVB Financial Group’s chief restructuring officer, said in a statement Friday. evaluates options.” ,
Regulated broker-dealer SVB Securities and Venture Capital’s fund and private credit fund platform SVB Capital and its general partner entities are not involved in the Chapter 11 filing and continue to operate as normal.
Loan unsecured notes financed for SVB Financial Group totaled approximately $3.3 billion in principal amount. There is no claim against SVB Capital or SVB Securities. SVB Financial Group has $3.7 billion of preferred equity outstanding.
SVB Financial Group believes it has liquidity of approximately $2.2 billion. The Santa Clara, California-based company said it also has other valuable investment securities accounts and other assets for which it is exploring strategic options.
The shuttering of Silicon Valley Bank last Friday and New York-based Signature Bank two days later brought back dark memories of the financial crisis that plunged the United States into the Great Recession of 2007-2009.
Over the weekend the federal government, determined to restore public confidence in the banking system, moved to protect all bank deposits, even those that exceed the FDIC’s limit of $250,000 per individual account. was more