Find the latest breaking news and information on the top stories, science, business, entertainment, politics, and more.

Silicon Valley Bank’s former parent company files for Chapter 11 bankruptcy protection

SVB Financial Group filed for Chapter 11 bankruptcy protection on Friday, just days after US regulators seized control of embattled Silicon Valley Bank.

The entity that once owned SVB listed assets and liabilities of up to $10 billion each in the petitionfiled in the Southern District of New York.

“The Chapter 11 Process will allow SVB Financial Group to preserve value while evaluating strategic alternatives for its prized businesses and assets, especially SVB Capital and SVB Securities,” William Kosturos, head of restructuring at SVB Financial Group, said in a statement on Friday.

“SVB Capital and SVB Securities continue to operate and serve clients, led by their long-standing and independent leadership teams,” it added.

SVB Financial Group lost its affiliation with Silicon Valley Bank when it was seized by the Federal Deposit Insurance Corporation on March 10. Trading in the company’s shares has since been halted and a bankruptcy filing was expected to follow.

its collapse marked the second largest bank failure in U.S. history since Washington Mutual went bankrupt during the 2008 financial crisis. It also came just days before New York-based Signature Bank closed and its assets were seized by the state Department of Financial Services on Sunday.

The decision to start bankruptcy proceedings comes after the Santa Clara, California-based company said it was working to explore strategic alternatives for its businesses, including SVB Capital and SVB Securities. In another attempt to bolster confidence, the federal government moved over the weekend to protect all bank deposits, even those that exceeded the FDIC’s $250,000 individual account limit.

SVB Financial Group believes it has approximately $2.2 billion of liquidity, as well as “other valuable investment securities accounts and other assets for which it is also exploring strategic alternatives,” according to the press release. He also pointed to a funded debt of $3.3 billion “in aggregate principal amount of unsecured notes,” which are only a resource for SVB Financial Group “and have no claim against SVB Capital or SVB Securities.”

with cable news services

Source link