JUST IN: SVB Financial Group Files for Chapter 11 Bankruptcy

SVB Financial Group is filing for bankruptcy just a week after its Silicon Valley Bank was shut down and taken over by regulators, a move that has sparked panic across the banking sector and helped to reshape expectations for U.S. monetary policy.

SVB Financial (ticker: SIVB) has filed for a court-supervised reorganization under Chapter 11 bankruptcy protection in New York, the company said Friday, the latest twist for a business that once sat at the heart of the U.S. tech startup scene.

The group said it believes it has approximately $2.2 billion of liquidity, in addition to “valuable investment securities accounts and other assets” for which it is exploring strategic alternatives, with funded debt of approximately $3.3 billion.

SVB Financial also has interests in SVB Capital and SVB Securities—discrete venture-capital and broker-dealer businesses, respectively, which are excluded from the bankruptcy. SVB Capital continues to have access to funding and SVB Securities—of which SVB Financial owns the equity—continues to operate, the group said. The bankruptcy of the main holding company paves the way for these other business lines to be sold.

“The Chapter 11 process will allow SVB Financial Group to preserve value as it evaluates strategic alternatives for its prized businesses and assets, especially SVB Capital and SVB Securities,” William Kosturos, SVB Financial’s chief restructuring officer, said in a statement. Kosturos said that the group will continue to work with Silicon Valley Bridge Bank, which succeeded the failed Silicon Valley Bank and has been operating under the jurisdiction of the Federal Deposit Insurance Corp.


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