SVB Parent’s Fight for Seized Deposits Will Test FDIC Authority

The Federal Deposit Insurance Corp. is poised to put up an aggressive fight in a showdown over $2 billion that Silicon Valley Bank’s former parent company and its bondholders say belongs to them.

The $2 billion bank deposit represents a significant amount of potential cash recovery to the bankrupt SVB Financial Group and its bondholders, who are owed $3.3 billion, and other creditors. But the FDIC has laid claim to the money. It aims to offset potential claims related to Silicon Valley Bank, which cost the FDIC’s deposit insurance fund an estimated $20 billion.

The emerging battle over the $2 ...