Silicon Valley Bank: parent company, CEO and CFO sued amid market turmoil
SVB Financial Group and two top executives have been sued by shareholders over the collapse of Silicon Valley Bank, as global stocks continued to suffer on Tuesday despite assurances from US president Joe Biden.
The bank’s shareholders accuse SVB Financial Group chief executive Greg Becker and chief financial officer Daniel Beck of concealing how rising interest rates would leave its Silicon Valley Bank unit “particularly susceptible” to a bank run.
The proposed class action was filed on Monday in the federal court in San Jose, California.
It appeared to be the first of many likely lawsuits over the demise of Silicon Valley Bank (SVB), which US regulators seized on 10 March after a surge of deposit withdrawals.
The news came as shock waves from the collapse of SVB pounded global bank stocks further on Tuesday, with calls for calm from Biden and other policymakers doing little to reassure markets and prompting some analysts to rethink their outlook on interest rates.
“Americans can rest assured that our banking system is safe. Your deposits are safe. Let me also assure you, we will not stop at this. We’ll do whatever is needed,” Biden said on Monday.
Biden’s comments, along with emergency US measures to guarantee the deposits of SVB’s customers and shore up banks by giving them access to additional funding, failed to dispel investor worries about potential contagion across the banking sector.
Banking stocks in Asia extended declines on Tuesday, with Japan’s banking subindex leading the fall, down 6.7% in early trade to its lowest since December.
“Bank runs have started [and] interbank markets have become stressed,” said Damien Boey, chief equity strategist at Sydney-based investment bank Barrenjoey. “Arguably, liquidity measures
Read more on theguardian.com
