Bankrupt SVB Financial Seeks Approval to Sell Securities Unit

SVB Financial Group, the bankrupt parent of Silicon Valley Bank, is seeking to sell its non-bankrupt investment banking subsidiary in an auction, hoping to boost its value as it faces creditors’ payout demands.

SVB Financial’s request to a New York bankruptcy court on Thursday to sell off SVB Securities Holdings LLC comes as the bankrupt company spars with the Federal Deposit Insurance Corp. over access to records and $2 billion the agency seized after Silicon Valley Bank failed in March.

“Numerous parties” have expressed interest in the business, SVB Financial said. The sale could include SVB Securities Holdings or its subsidiaries, which include SVB Securities LLC, SVB MEDACorp LLC, and MoffettNathanson LLC, the filing said.

SVB Financial has asked for a bid deadline by May 22, and possibly holding an auction by May 25.

SVB Financial Group has estimated it has about $2.2 billion of liquidity, including cash and interests in SVB Capital and SVB Securities. It owes bondholders—all of which are unsecured—about $3.3 billion.

SVB Financial bought the securities bank from Leerink Holdings LLC in 2019 for $280 million. Leerink has recently explored buying SVB Securities back, Bloomberg News reported.

Bloomberg News also reported that Moelis & Co. has been recruiting from the securities arm.

The case is SVB Financial Group, Bankr. S.D.N.Y., No. 23-10367, 4/27/23.