SVB Cayman Liquidators Sue Bankrupt Ex-Parent Over $294 Million

Silicon Valley Bank’s Cayman Islands liquidators are asking a US bankruptcy court to void a $294 million distribution made from SVB to its sole shareholder shortly before it became insolvent.

The US Bankruptcy Court for the Southern District of New York should declare as null the transfer made to the bank’s former parent, SVB Financial Group, because it is illegal under a California law barring banks from making transfers when they are insolvent or near-insolvent, liquidators said. The payment was made at a time when directors and officers knew the bank was insolvent, they said.

“SVB made a $294 million ...