SVB Financial, the bankrupt parent company of Silicon Valley Bank, has lost access to its financial records after the bank was placed into receivership by the Federal Deposit Insurance Corporation (FDIC), according to court documents filed in Manhattan on Sunday.
SVB Financial is exploring options, including a potential bankruptcy sale, for its venture capital and investment banking businesses, which were not included in the FDIC's takeover of SVB. But its Chapter 11 bankruptcy has gotten off to a "challenging" start due to a breakdown in cooperation with the bridge bank set up to take over SVB's business, according to a declaration filed Sunday by SVB Financial Chief Restructuring Officer William Kosturos in U.S. bankruptcy court.
SVB Financial has no employees of its own, and the new bank's employees "cut off access" to a substantial portion of SVB Financial's "books, records, files, electronic systems and key employees," according to Kosturos.
Kosturos said SVB Financial is working to re-establish access.
SVB Financial filed for bankruptcy protection on Friday, about a week after California banking regulators closed Silicon Valley Bank in the largest U.S. bank failure since the 2008 financial crisis.
The FDIC is attempting to sell SVB and may seek a breakup of the failed lender.
The FDIC receivership removed SVB Financial's primary source of liquidity and most of its business infrastructure, as well as triggering defaults on SVB Financial's debt, forcing the company into bankruptcy, according to court documents.
SVB Financial's court filings listed $19 billion in assets, $2.2 billion in cash and cash equivalents, and $3.4 billion in liabilities. About $15.5 billion of SVB Financial's asset value was attributed to the SVB banking business that was seized by regulators.
SVB Capital, the venture capital and credit investment arm of the company, manages about $9.5 billion in other investors' money spread across 30 pooled investment funds, according to Kosturos' declaration.
Those investment funds include direct venture funds that invest in companies, funds-of-funds that invest in other venture capital funds, and debt funds that provide lending and other financing solutions to startups.
SVB Securities is an investment bank that provides financial services to healthcare and technology companies, according to Kosturos' declaration.
In its court filings on Sunday, SVB Financial also made several requests intended to continue smooth operation of its business during its bankruptcy, such as asking for permission to maintain its existing bank accounts and to continue paying for services provided by SVB employees.