A group of shareholders of the bankrupt US bank Silicon Valley Bank (SVB) filed a fraud lawsuit once morest the parent company of the credit institution SVB Financial Group. The lawsuit also concerns two high-ranking representatives of the bank’s management, writes Archyde.com.
According to the shareholders, the agency writes, management representatives concealed how the increase in interest rates of the US Federal Reserve System really affected the state of the bank’s balance sheet. In addition, shareholders accuse the bank of hiding its “special exposure” to the risk of bankruptcy.
On March 11, Silicon Valley Bank was declared bankrupt by the California regulator. SVB is the 16th largest bank in the US. The SVB bankruptcy was the largest since the 2008 crisis. He became the second largest bankrupt in US history following Washington Mutual Bank.
On March 8, the bank carried out an additional share issue for $1.75 billion “to strengthen its balance sheet.” In its investor prospectus, the bank explained that it needed to recover $1.8 billion in losses it incurred as a result of the sale of part of its asset portfolio. After that, the company’s shares collapsed by 60%.
Later also closed due to systemic risks Signature Bank. US President Joe Biden promised that the management of bankrupt banks would be fired and held accountable, and supervision and regulation measures once morest the banking sector would be tightened.
Read more regarding bankruptcy in the material “Kommersant” “SVB pulled the markets.”