Silicon Valley Bank chief sold $3.6 million stake two weeks before collapse

[March 13, 2023](Compiled and reported by Epoch Times reporter Xue Mingzhu) According to the English Epoch Times report, inSilicon Valley Bank(SVB)collapseIn previous weeks, the bank’s chief executive sold a $3.6 million stake in parent company SVB Financial Group.stock.

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According to SEC filings, Greg Becker joined theSilicon Valley BankWorked as a loan officer and became CEO about 10 years later. On Feb. 27, he sold 12,451 shares of the bank’s parent company, Silicon Valley Bank Financial Group.stock.

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Baker sold the shares under a trading plan filed Jan. 26. A month later, the group sent a letter to stakeholders stating that the group was raising more than $2 billion to cover the shortfall.

Was Becker aware of the bank’s fundraising plan when he sold the shares and filed the related plan? In response to this query, neither Becker nor Silicon Valley Bank immediately responded.

Last Wednesday (March 8), Silicon Valley Bank announced a loss and the sale of assets triggered market panic; last Friday (March 10), California regulators ordered Silicon Valley Bank to close on the grounds of “insufficient liquidity and insolvency” , and designated the Federal Deposit Insurance Corporation (FDIC) to take over.

In an interview with Reuters, Sheila Bair, who led the U.S. Federal Deposit Insurance Corporation (FDIC) on its response to the global financial crisis, said bank regulators may now turn their attention to other financial institutions that may have a large number of unforeseen risks. Insured deposits, banks with potential risk of loss. These two factors contributed to the rapid collapse of Silicon Valley Bank.

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“These banks with a lot of uninsured money … if there’s any sign of trouble, that money is going to be hot money, it’s going to run,” Bell said.

The chain of events that led to the swift collapse of Silicon Valley Bank also included selling U.S. Treasuries to lock in its cost of funding in anticipation of rising interest rates.

The Federal Reserve has been quick to raise interest rates in the face of persistently high inflation. Officials warned of further tightening ahead. ◇#

Responsible editor: Song Jiayi