Why SVB parent company filing for bankruptcy after government intervention
The reason why the parent company of the Californian bank SVB is filed a Chapter 11 bankruptcy file is not clear to me after the government stepped in and implemented bailouts.
SVB Financial Groups announces bankruptcy filing via a press release on Friday. The company claimed that there is nothing wrong with the company and that other parts of the company such as SVB capital and SVB securities are fine, but the filing will serve as a means of restructuring as the company has no liquidity to fund the coverage of the latest debt.
I am investigating this case of SVB as a thief who comes to the police for his own arrest without revealing his crime. I don't know if you have heard about actions by the President of the United States against banking companies that sell their assets and later collapse. There will be a severe punishment for such a company, while SVB sells a part of assets worth 2 billion dollars a few weeks before the crisis, could be the reason for its voluntary request to the court.
While the company claimed to preserve its values and therefore admit submitting to a bankruptcy court in the Southern District of New York. I never see this steps as part if restructuring at all as SVB capital and SVB Securities and general are not included in this Chapter 11 filing, so for what?
I said it in my previous post that they are sticking with the long haul and selling back at a loss that created problems for them, customers lost confidence and did a big pullback that caused turmoil that spread to other banking sectors. The company suffered an after-tax loss of $1.8 billion due to changes in the Fed's monetary policy to hold assets over several years. However, the financial company fell by more than 35% and in order not to have further plummet, I don't think the next step is to file for bankruptcy. We know that customer withdrawal was the main driveing of their instability, as customers withdraw more than the total deposit in Q4 2022 annual report, while knowing that the company is going through financial problems, so if that and nothing else is wrong with SVB, why file for bankruptcy .
Well, I hope these steps will not lead them to the gravity of a bad situation.
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