Parent business of SVB declares bankruptcy

SVB Financial Group, the parent company of the failed Silicon Valley Bank, has filed for Chapter 11 bankruptcy, the bank said in a statement on Friday. The filing comes days after a class action lawsuit accused the financial group of failing to disclose risks. The rest of SVB Financial Group, which consists of a venture capital and private credit fund, a registered broker-dealer, and about $2.2 billion in liquid assets, will be sold off in an effort to repay creditors and large depositors alike. The FDIC only covers customer deposits under $250,000, but the administration of President Joe Biden stepped in to guarantee those exceeding that amount, rankling critics who see it as a bailout masquerading as a regulatory action. New York-based Signature Bank collapsed just days after SVB, triggering fears of a wider contagion even as the president attempted to reassure Americans that their finances were safe. 90% of its deposits exceeded the FDIC cap.