Silicon Valley Bank shares suspended after bailout plan failed and shares of other banks fall

Silicon Valley Bank

Silicon Valley Bank (SVB) has failed in its attempt to raise capital and is in talks to sell it, according to the US media CNBC.

The shares of the SVB have plummeted another 60% this Friday in the electronic activities prior to the opening of the Wall Street Stock Exchange, a fall that is added to the one experienced yesterday and that is weighing down the banking sector inside and outside the United States Joined. The shares did not open for trading with the rest of the market at 9:30 in the morning and remained paralyzed.

Around 15:20 (GMT) the main indices of the New York Stock Exchange registered falls. The Dow Jones lost 87.13 points, to 32,167.73, while the selective S&P 500 subtracted 0.62% or 24.14 units, to 3,894.18. The Nasdaq had the biggest drop: 112.6 points, a decline of almost 1%.

The bank, focused mainly on start-ups, especially in the technology and science sectors, was forced to carry out a forced sale of securities on Wednesday for a value of 21,000 million dollars, which supposed losses of 1,800 million and resulted in a fall 60% of its shares on Wall Street.

In the United States, several financial institutions have been dragged by the movement of SVB, such as Signature Bank, which fell 12% yesterday and today was left close to 10% in electronic activities prior to the opening of the trading floor, and First Republic Bank, whose shares depreciated 17% yesterday and fell 15% this morning.

Although other large corporations such as JPMorgan Chase felt the weight of the fall of the SVB yesterday with a loss of 5%, this Friday, before the opening, its shares were left only 0.28 %.

Similarly, Goldman Sachs shares, which fell 2% yesterday, lost another 0.29% today before the opening.

Despite the stock market commotion, some analysts have wanted to downplay the issue by assuring that the fall of Silicon Valley Bank is a private issue that concerns only that institution.

“The current pressures facing SVB are highly idiosyncratic and should not be seen as an extrapolation to other banks,” analysts Manan Gosalia and Betsy Graseck said in a Morgan Stanley note, quoted by CNBC.