• SVB Financial Group, the parent company of Silicon Valley Bank, has filed for bankruptcy protection.
• The filing was submitted in the Southern District of New York and aims to preserve company value.
• Customers will receive funds via FDIC insurance and an emergency plan from the Biden administration and U.S. Treasury.

Filing for Bankruptcy Protection

SVB Financial Group, the parent company of Silicon Valley Bank, has filed for bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code in the Southern District of New York on March 17th, with a plan to explore strategic alternatives as determined by a board-appointed restructuring team made up of five members. Joele Frank is involved in this case as well.

Continuing Services

Though Silicon Valley Bank has failed, SVB’s other services — SVB Capital and SVB Securities — will continue to provide services to their customers with no disruption in service quality or customer experience expected during this process since they are no longer associated with the failed bank.

Cause of Bankruptcy

The collapse occurred shortly after Silicon Valley Bank announced plans to over $2 billion of funds which caused a weekend bank run leading to its failure and shut down by US regulators who took over control of customer assets on March 10th.. Circle and BlockFi were among cryptocurrency companies affected by this failure.

Receiving Funds

Customers will regain access to their funds elsewhere as Federal Deposit Insurance Corporation (FDIC) provides them with insured portion while an emergency plan from the Biden administration and U.S. Treasury provides them rest amount from their funds .

Preserving Company Value

SVB Financial Group believes that it has $3 billion worth debt unsecured notes ,$3 billion worth outstanding preferred equity alongwith $ 2 billion worth liquidity which would be preserved through this reorganization process .