The parent of Silicon Valley Bank filed for Chapter 11 bankruptcy a week after the tech-focused bank failed and was seized by the U.S. government.
The filing from SVB Financial Group on Friday is not a surprise, with much of the company now under the control of U.S. banking regulators. During the 2008 financial crisis, the parent companies of failed banks Washington Mutual and IndyMac -- filed for bankruptcy protection in the days after their banking operations failed.
SVB Financial Group is no longer affiliated with Silicon Valley Bank after its seizure by the Federal Deposit Insurance Corporation. The bank's successor, Silicon Valley Bridge Bank, is being run under the jurisdiction of the FDIC and is not included in the Chapter 11 filing. The Wall Street Journal reported that a group of distressed debt investors -- mostly hedge funds -- bought up the bonds of Silicon Valley Bank's holding company in a bet that that there will be some proceeds for bondholders after the bankruptcy process is completed.
SVB Capital is the company's venture capital and private credit fund. SVB Securities is a regulated broker-dealer. Both continue to operate and have sources of funding, the company said.
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