SVB Financial Group said on Tuesday the U.S. Federal Deposit Insurance Corporation had taken 'improper actions' to cut it off from cash held at its former subsidiary Silicon Valley Bank, which was seized by regulators to stem a national bank run.
SVB Financial is exploring options, including a potential bankruptcy sale, for its venture capital and investment banking units, which were not included in the FDIC takeover of Silicon Valley Bank, while continuing to operate its businesses, it said on Monday.
The company, which has about $2 billion in cash at its former subsidiary, said in court filings that the FDIC receiver had blocked a $250 million wire transfer, removed $19 million from an SVB Financial bank account, and attempted to claw back payments to SVB Financial's bankruptcy attorneys and financial advisers, among other "improper actions."
The company has asked U.S. Bankruptcy Judge Martin Glenn, who is overseeing its Chapter 11 process, to allow it to move funds held at Silicon Valley Bank to a different bank. But the FDIC said in Tuesday court filings that it had placed a hold on all of SVB Financial's bank accounts, as part of its investigation of potential claims against the bank's former parent. That action was a legal and necessary part of stabilizing banking operations during the transfer to new management, according to the court filings.
Reporting by Dietrich Knauth in New York and Tom Hals in Wilmington, Delaware, Editing by Alexia Garamfalvi and Matthew Lewis
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