Silicon Valley Bank Financial, the publicly traded holding company Silicon Valley Bankhe have Trading temporarily suspended This morning waiting for an announcement. The latest, from usually reliable market tracker Deltaone, is that it sent a note to employees advising them to work from home until further notice as it engages in “conversations to determine the bank’s next steps.”
The notice follows a A report at CNBC Earlier in the day saying that the company is in talks to sell itself.
The developments are the latest troubling turns for the technology-focused lender in what was a sudden and rapid collapse.
SVB – the A bank to many Silicon Valley startups and other players in the sector – grappling with a number of issues, all in quick succession: rising interest rates, Losses mountsending messages to the market about its condition, and more recently a bank scramble, with a rush of customers withdrawing their money.
Shares of Silicon Valley Bank Financial fell 60% on Thursday.
CNBC did not identify the buyer. It reported that the Silicon Valley bank had tried to raise money from investors before exploring a sale, but was unsuccessful. No official word from the company.
The California-based lender teased many of its customers Wednesday after it announce The company plans to offer $1.25 billion of its common stock to investors and another $500 million of mandatory convertible preference shares. General Atlantic said it agreed to buy $500 million of the bank’s common stock in a separate private transaction, though that was contingent on closing the common stock offering, in its SEC filing. We’ve reached out to General Atlantic to claim the latest case for a $500 million commitment.
From the start it seemed as if much of SVB’s problems stemmed from the way SVB severely mishandled its news: specifically, it released its plans to sell common stock just as another bank – cryptocurrency bank Silvergate – announced it would close and go into liquidation. . In support of that, a call yesterday led by the company’s CEO Greg Baker to calm the market repeatedly emphasized the company’s liquidity and strong position.
However, recent reports indicate unease behind the scenes for months about the SVB situation. Greenoaks warned portfolio companies back in November about the state of the bank, according to a report in Bloomberg. About a dozen companies from their investment portfolio have collectively withdrawn about $1 billion from SVB in recent months.
And as Connie pointed out yesterday, the fact that Silicon Valley Bank has failed to diversify its business lately has been a problem hidden in plain sight, exacerbated not only by the current economic situation but by the massive downturn in technology. Sector – SVB’s mainstay bread and butter – in particular.
More to come, please update to update.
“Beer fan. Travel specialist. Amateur alcohol scholar. Bacon trailblazer. Music fanatic.”