SVB Financial Files For Bankruptcy: RBI Governor Shaktikanta Das on Friday cautioned Indian banks on asset-liability mismatch as SVB Financial, Silicon Valley Bank Parent company, filed for bankruptcy today. SVB Financial sought bankruptcy protection after US authorities took over as it could not manage to stay afloat on its own. SVB specialised in financing startups and had become the 16th largest US bank by assets: at the end of 2022, it had $209 billion in assets and approximately $175.4 billion in deposits. SVB Financial Group is no longer affiliated with Silicon Valley Bank after its seizure by the Federal Deposit Insurance Corp.
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The SVB crisis in many ways serves as a reminder of the financial crisis of 2008.
How This Will Impact Indian Startups
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Several Indian startups had more than a billion dollars of their funds in SVB, Union Minister Rajeev Chandrashekhar said. Chandrashekhar assured that he passed on the suggestions of the startups affected by SVB’s closing to Finance Minister Nirmala Sitharaman.
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Citing the suggestions proposed to the Finance Minister, Chandrashekhar said, Indian banks could offer a deposit-backed credit line to startups that had funds in SVB, using those as collateral.
