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Silicon Valley Bank’s parent company files for bankruptcy and seeks legal protection

Silicon Valley Bank Financial Group, the parent company of the shuttered Silicon Valley Bank (SVB), filed for bankruptcy on Friday. This, in an attempt to obtain the capital restructuring, under judicial supervision, of the businesses that have been intervened by the authorities.

“The Chapter 11 (United States Bankruptcy Law) process will allow SVB Financial Group to preserve value while evaluating strategic alternatives for your precious businesses and assets, especially SVB Capital and SVB Securities“, said in a statement the director of restructuring of SVB Financial Group, William Kosturos.

As recalled, the US authorities intervened in the SVB, but not in its parent company, which has approximately US$2.2 billion in liquidity. However, the price of its shares is paralyzed.

“SVB Securities and SVB Capital funds and general partner entities are not included in the Chapter 11 filing and continue to operate in the normal course,” the SVB said in a letter.

The SVB Financial Group currently maintains consolidated debt of US$3.3 billion in principal amount, plus unsecured notes. In addition, it has $3.7 billion in preferred stock outstanding. These could disappear in bankruptcy.

With information from EFE

Source: Larepublica


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