Silicon Valley Bank’s CEO sold $3.5M in stock just two weeks before the bank collapsed
Two top Silicon Valley bank executives dumped millions of dollars worth of stock on Friday, just two weeks before the company collapsed, a media report said. CEO Greg Baker offloaded more than $3.5 million in shares in a pre-planned, automated sell-off on February 27—amounting to roughly 12,500 shares, according to a US Securities and Exchange Commission filing, the New York Post reported.
Newsweek gave information
On the same day, Daniel Beck, the bank’s third-in-command CFO, sold $575,180 in shares, Newsweek reported. Silicon Valley Bank, once a leading tech lender, was shut down by federal authorities after just 11 days.
The New York Post also reported
The New York Post reported that Baker & Beck sold its large stake in a legal corporate trading scheme set up by the SEC to thwart insider trading, so it’s unclear whether the CEO and CFO knew the company was just two weeks away. I will fall.
Bank loss due to sale of bond holdings
The firm was abruptly shut down on Friday by the California Department of Financial Protection and Innovation due to liquidity concerns. SVB disclosed that it took a loss of $1.8 billion from the sale of $21 billion of its bond holdings. The New York Post reported that it faced a cash crunch due to rising interest rates and the recent downturn in the tech sector, causing many customers to reduce their deposits.
SVB Financial shares fall 120% in two days
Shares of the bank’s parent company SVB Financial fell by 60 per cent on Thursday. The stock was down 60 per cent in premarket trading on Friday, till the halt. The New York Post reported that the sudden collapse has investors worried about a recession similar to the 2008 financial crisis, although it is not yet clear what the full impact will be. Police were called to the Manhattan branch on Friday as depositors thronged the building to withdraw money.