The US authorities have failed to find a Silicon Valley Bank (SVB) buyer. So they plan to break up the California bank, which went bankrupt after a bank run. That writes the financial agency Bloomberg based on sources close to the file.
According to the sources, the federal government agency FDIC (Federal Deposit Insurance Corporation) wants to sell the California bank in at least two parts. Interested parties should submit an offer this week.
With a division into pieces, the FDIC would follow the scenario of Signature Bank, the second bank to fail in the United States in recent days. Flagstar Bank, a New York Community Bancorp branch, will take over the first part of that bank’s assets.
Silicon Valley Bank was mainly active in the technology sector. The bank got into trouble because of the rising interest. This made refinancing existing loans, which had been taken out at low rates, expensive and difficult. The problems led to a bank run: customers tried to withdraw their credits en masse. The bank did not get enough cash and eventually had to be closed by the authorities.
The SVB failure was the largest US bank failure since the 2008 financial crisis.
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