NEW YORK, March 10, 2023 (GLOBE NEWSWIRE) -- Kaplan Fox & Kilsheimer LLP (www.kaplanfox.com) is investigating claims on behalf of investors in SVB Financial Group (Nasdaq: SIVB) (“SVB”).
If you would like to discuss our investigation, please contact us by emailing jcampisi@kaplanfox.com or by calling (212) 329-8571, or click here.
On March 9, 2023, Barron’s published an article titled “SVB Financial Realigns Portfolio—and Blows Up the Banking Sector” that stated “Lender SVB Financial Group’s stock plummeted Thursday causing ripples in the banking industry, which had largely been insulated from recession worries and rising rates. SVB’s troubles came as the Silicon Valley-based lender was forced to sell securities to realign its portfolio in response to higher interest rates while it manages lower deposit levels from clients, many of which are in the venture capital arena and burning through cash.”
Also on March 9, 2023, The Motley Fool published an article that stated “[a]s liquidity funneled into the banking system during the early part of the pandemic and tech and growth valuations took off, deposits at SVB surged, ballooning SVB's balance sheet and leading management to invest excess deposits into bonds to boost profitability. . . Between the end of the second quarter of 2022 and the end of the year, SVB saw noninterest-bearing deposits, which it pays no interest on, fall by close to $34 billion. These trends have continued in the current quarter, and to help cover these outflows, SVB has sold its entire available-for-sale bond portfolio, which resulted in a loss of roughly $1.8 billion. Bonds have been underwater as bond yields have soared. Losses on bonds are only paper losses while a bank holds them, but once they are sold, the bank has permanently destroyed shareholder equity. Furthermore, Moody's Investor Service recently downgraded the credit ratings of SVB due to liquidity and funding issues. . . .”
On March 9, 2023, SVB shares declined from a close on March 8, 2023 of $267.83 per share to close at $106.04 per share, a decline of $161.79 per share, or approximately 60%, on heavier than usual volume.
On March 10, 2023, The Wall Street Journal reported that “[r]egulators shut down Silicon Valley Bank [] after a run on deposits doomed the tech-focused lender’s plans to raise capital”, and trading in SVB shares was halted.
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If you have any questions about this investigation, please contact:
Jeffrey P. Campisi
KAPLAN FOX & KILSHEIMER LLP
800 Third Avenue, 38th Floor
New York, New York 10022
Ph: (212) 329-8571
E-mail: jcampisi@kaplanfox.com
Laurence D. King
KAPLAN FOX & KILSHEIMER LLP
1999 Harrison Street, Suite 1560
Oakland, California 94612
Ph: (415) 772-4700
Fax: (415) 772-4707
E-mail: lking@kaplanfox.com
