SVB Financial (SIVB) stock crashes 50% as tech investment bank seeks to raise more cash
The tech-focused bank announced a plan to raise over $2 billion in capital in an attempt to offset losses on bond sales.
Tech-centered bank SVB Financial’s stock plummeted so heavily today that trading of the stock was halted several times for volatility. The drop in value comes after communications that the company will be attempting to raise capital to offset, including selling nearly all of its available-for-sale securities. With the company looking to gather around $2 billion USD in cash, its stock dropped over 50 percent on the announcement.
The announcement of this plan came from a letter by SVB Financial CEO Greg Becker, who published the letter on SVB’s investor relations website on March 8, 2023. In said letter, Becker explained the company’s selling of its securities, as well as the plan to raise more cash:
Trading on SVB stock was halted multiple times on March 9 as the stock’s value drop peaked at around 60 percent of its starting value. The SVB Financial is heavily involved in various tech startups, but cited increased client cash burn and raised federal interest rates as heavy contributors to its current state, the latter of which contributed to major losses for the company on bonds. While much of the cryptocurrency market fails and many companies go under, including major crypto bank Silvergate Capital recently announcing shutdown of its banking operation, SVB claims it has little investment and exposure in crypto.
Nonetheless, SVB’s stock price seems to be in dire straits following today’s news. Stay tuned as we continue to watch for further updates to this story.
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replyTJ Denzer posted a new article, SVB Financial (SIVB) stock crashes 50% as tech investment bank seeks to raise more cash
