Finance
SVB Races to Prevent Bank Run as Funds Advise Pulling Cash
- Europe’s biggest banks lost over $40 billion in value Friday
- Panic spreads across the financial world about bank’s health
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Unease is spreading across the financial world as concerns about the stability of Silicon Valley Bank prompt prominent venture capitalists including Peter Thiel’s Founders Fund to advise startups to withdraw their money.
The turmoil followed a surprise announcement from Santa Clara, California-based SVB that it was issuing $2.25 billion of shares to bolster its capital position after a significant loss on its investment portfolio. The stock plunged 63% in premarket trading in New York on Friday before trading in the bank’s parent was halted with news pending. They declined 60% the day before. Its bonds posted record declines, igniting a broad selloff in bank shares around the world.