SVB issued $219 million in loans to insiders shortly before the collapse

Silicon Valley Bank (SVB), which filed for bankruptcy in March, issued more than $219 million in insider loans shortly before its collapse.

In the last quarter of 2022, total loans to officers, directors and major shareholders and related parties tripled from the previous quarter. This is a record amount of loans to insiders in at least the past two decades.

The surge in loans to officials could draw close scrutiny from authorities as the SVB debacle is being investigated by Congress and the Federal Reserve (Fed), which serves as the U.S. Central Bank. At the same time, the government reports do not disclose data on loan recipients and there have been no accusations of wrongdoing related to insider loans. Loans to high-profile individuals grew as the bank’s problems and weaknesses became known.

Silicon Valley Bank of California declared bankruptcy on March 10. On that day, SVB Financial Group filed a report with the U.S. Securities and Exchange Commission (SEC) announcing the closure of its Silicon Valley Bank subsidiary. The bank had been one of the most prominent lenders to U.S. startups as well as IT and healthcare companies, ranking 16th in the country in terms of assets. Thus, its collapse was the most significant in the U.S. since the 2008 crisis.

You may be interested: The world’s largest Ferris wheel will appear in Seoul