The former parent company of Silicon Valley Bank SVB Financial Group has filed for bankruptcy protection.
Source: Pixabay.com
The decision to file this application was made about a week after the Silicon Valley Bank came under the control of regulatory authorities. Bankruptcy protection should preserve the value of the company, which is currently actively exploring alternative options for the implementation of strategic activities of the broker-dealer division of SVB Securities and the venture capital division of SVB Capital.
There are interests in these divisions on the part of potential buyers whose funds and organizations that are general partners were included in the application.
Representatives of the company state that in the current situation, the liquidity is about $ 2.2 billion. The accumulated debt of the firm is currently about $3.3 billion. There are 3.7 billion shares of the preferred category in circulation.
The application for bankruptcy protection was filed under Chapter 11. William Kosturos, Director of Restructuring at SVB Financial Group, says that this type of procedure will provide an opportunity to preserve value, as strategic alternatives for enterprises and assets, including SVB Capital and SVB Securities, are being evaluated.
SVB Financial Group is currently operating normally. The company emphasizes that now it has nothing to do with the activities of the Silicon Valley Bank and its wealth and capital management unit SVB Private.
The California Department of Financial Protection and Innovation decided on March 10 to close the Silicon Valley Bank. The financial institution came under the control of the FDIC. The US Treasury Department, the Fed, and the FDIC announced the bank’s reorganization on March 13. This means that deposit holders will have access to funds at the expense of shareholders and some holders of unsecured bonds.
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