Silicon Valley Bank Financial is a publicly traded holding company Silicon Valley Bankhas Suspended trading Pending announcement this morning. The latest from usually reliable market tracker Deltaone is that a memo was sent to employees asking them to work from home until further notice while engaging in “conversations to determine next steps for the bank.”
This announcement was made by ADMK Report on CNBC The company said earlier today that it was in talks to sell itself.
The developments are the latest troubling twists for the tech-focused lender, which has seen a surprising, rapid decline.
SVB – The The bank — for many Silicon Valley startups and other power players in the sector — has faced a number of problems, all in quick succession: rising interest rates, mounting lossesSending news of its state of affairs to the market, and more recently a run on the bank, with customers rushing to pull their money out.
Shares of Silicon Valley Bank Financial fell 60% on Thursday.
CNBC did not identify the buyer. Silicon Valley Bank reportedly tried to raise money from investors before exploring a sale but was unsuccessful. No official word from the company.
The California-based lender spooked many of its customers on Wednesday declared It plans to issue $1.25 billion of its common stock to investors and another $500 million in mandatorily convertible preferred stock. General Atlantic said it had agreed to buy $500 million of the bank’s common stock in a separate private transaction, though that was contingent on the completion of the common stock offering. According to its SEC filing. We reached out to General Atlantic to ask about the latest status of that $500 million commitment.
From the start it looked as though much of SVB’s woes stemmed from how it mishandled its news so badly: namely, that it announced plans to sell public shares just as another bank, the crypto bank Silvergate, had announced it was shutting down and liquidating. . In support of that, a call to calm the market yesterday led by its CEO Greg Becker reiterated the company’s liquidity and soundness.
However, recent reports point to months of behind-the-scenes unrest over the status of the SVB. Greenoaks alerted portfolio companies to the bank’s affairs in November, according to a report in Bloomberg. Its 12 portfolio companies have withdrawn $1 billion from SVB in recent months.
As Coney pointed out yesterday, Silicon Valley Bank’s recent failure to diversify its business is a problem hidden in plain sight, compounded not only by the current state of the economy, but also by the massive downturn that has hit tech. Department – SVB’s main bread and butter – esp.
More to come, update to update.