Pension Funds Point Finger At Silicon Valley Bank Officers
Posted on 04/11/2023
Three pension funds have targeted individual officers and directors from Silicon Valley Bank’s parent company, SVB Financial Group. Auditor KPMG is also named after allegedly failing to adequately state the company’s financial position. The matter will be handled by the U.S. District Court for the Northern District of California. The pensions bringing the suit are the City of Hialeah Employees’ Retirement System, the Asbestos Workers Philadelphia Welfare and Pension Plan, and the Pension Fund of Heat and Frost Insulators Local 12. Silicon Valley Bank officers named are CEO Greg Becker, CFO Daniel Beck, CAO Karen Hon, and Chairman Roger Dunbar. Goldman Sachs, BofA Securities, Morgan Stanley, and Keefe, Bruyette & Woods are also alleged to have violated the Securities Act but are not accused of fraud. Senior executives are said to have “concealed the magnitude of the risks facing the company’s business model.” This potentially misleading information made the pension funds eager to buy the company’s stock at prices that were inappropriate and hold it as it collapsed.
The Federal Deposit Insurance Corporation (FDIC) took over Silicon Valley Bank on March 10, 2023 after depositors rushed to pull out their money in a bank run.
HSBC
On another note, the U.S. unit of HSBC Holdings plc, has hired dozens of Silicon Valley Bank bankers led by David Sabow, who most recently led the technology and healthcare banking segment. HSBC USA said in a statement the hiring will help the bank establish a dedicated banking practice focused on serving companies in technology and healthcare, as well as investors who support them. HSBC said other hires included Sunita Patel, who will head up investor coverage and business development for technology and healthcare market, Katherine Andersen who will oversee life sciences and healthcare, and Melissa Stepanis, who will oversee technology.
HSBC’s new banking practice will sit within the bank’s U.S. commercial banking business, it said.
HSBC last month bought the U.K. arm of Silicon Valley Bank for a symbolic one pound, rescuing a key lender for technology start-ups in England.
