Silicon Valley Bank Financial Group has officially filed for Chapter 11 bankruptcy in the United States, the company revealed in a press release on Friday.
The embattled bank filed its voluntary petition hoping to conserve its assets, but will not include SVB Capital or SVB Securities in its bankruptcy filings.
SVB Financial Group also aims to explore strategic alternatives for its subsidiaries, adding it will no longer affiliate with Silicon Valley Bank NA or SVB Private, its private banking and wealth management operations.
The Federal Deposit Insurance Corporation (FDIC) supervises operations for Silicon Valley Bridge Bank NA.
Currently, SVB Group holds roughly $2.2 billion in liquidity, which includes interests, cash, and other “valuable investment securities accounts and other assets.”
However, according to figures, SVB Group has $3.3 billion in aggregate principal amount of unsecured notes, which do not affect SVB Capital or SVB Securities.
William Kosturos, SVB Group’s chief restructuring officer, said in a statement: “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.”
SVB, Silvergate Fallout
The news comes as the ongoing collapse of SVB, Silvergate Bank, and now-defunct cryptocurrency platform FTX has sent shockwaves across the cryptocurrency community. News of the most recent collapse has severely limited financing options for firms aiming to invest in Web3 technologies.
HSBC Bank purchased SVB’s British wing on Wednesday for just £1, allowing it to operate the former’s business dealings with key tech firms and small and medium enterprises (SMEs) in the United Kingdom.
Silvergate Bank also collapsed earlier in the month after authorities found it had facilitated payments for FTX and Alameda Research, the latter’s subsidiary.
News of the bank’s dealings with FTX forced numerous partners such as Paxos, Galaxy Digital, BitStamp, Coinbase, and Gemini to sever ties to the institution.
