SVB Financial Group, the corporate parent of Silicon Valley Bank, filed for Chapter 11 protection in the U.S. Bankruptcy Court for the Southern District of New York on March 17. According to a press release issued by SVB Financial Group, its related entities SVB Securities and SVB Capital are not included in the Chapter 11 filing. This bankruptcy filing comes a week after regulators took control of the failed Silicon Valley Bank.

What You Need to Know

• Silicon Valley Bank’s 48-hour collapse sent several Big Law firms into action late last week.

• Morgan Lewis, Wilmer, Wilson Sonsini and Ballard Spahr are among the laws firms that launched task forces and webinars over the weekend.

• Despite some reassurance from the FDIC on Sunday, there are lingering issues that are expected to continue to prevent firms’ clients from conducting business in the normal course.

Highlights

Counterparties should continue to follow their current contractual obligations

Silicon Valley Bank’s parent company bankruptcy filing will not impact contractual rights

Counterparties should be vigilant and consider alternate financing arrangements

This FAQ has been updated to take account of developments through March 15, 2023.

A GLOBAL LEGAL MEDIA & NISHLIS LEGAL MARKETING PUBLICATION THE US-ISRAEL LEGAL REVIEW 2022 IN ASSOCIATION WITH: Israel’s Unicorn Success Story SNNOVATION The US-Israel Legal Review 2022 1 Contents THE US-ISRAEL LEGAL REVIEW 2022 2 WELCOME FROM THE PUBLISHERS Global Legal Media and Nishlis Legal Marketing 4 ECONOMIC HEADWINDS, A HOT WAR AND A TRADE WAR: THE IMPACT ON ISRAEL’S COMPANIES With rising interest rates, rising inflation and reduced growth forecasts, how has that reality been faced by corporate clients and start-ups? Arnon, Tadmor-Levy provide some answers.

After a turbulent weekend, the news on Monday morning that HSBC had acquired Silicon Valley Bank UK (SVB UK) caused the UK tech community to breathe a huge sigh of relief.

It was also a very different outcome to the one that seemed destined on Friday when the Bank of England announced it intended to put SVB UK into a bank insolvency procedure.

After a turbulent weekend, the news on Monday morning that HSBC had acquired Silicon Valley Bank UK (SVB UK) caused the UK tech community to breathe a huge sigh of relief.

It was also a very different outcome to the one that seemed destined on Friday when the Bank of England announced it intended to put SVB UK into a bank insolvency procedure.

After a turbulent weekend, the news on Monday morning that HSBC had acquired Silicon Valley Bank UK (SVB UK) caused the UK tech community to breathe a huge sigh of relief.

It was also a very different outcome to the one that seemed destined on Friday when the Bank of England announced it intended to put SVB UK into a bank insolvency procedure.

Background

Last Friday in California, Silicon Valley Bank (SVB) was shut down by its local regulator and the Federal Deposit Insurance Corporation (FDIC) was appointed as receiver. Urgent regulatory action to prevent systemic risk in the USA and UK has followed.

In the second largest US bank failure since the 2008 global financial crisis, the California Department of Financial Protection and Innovation took over Silicon Valley Bank (“SVB”) on March 10 and appointed the Federal Deposit Insurance Corporation (“FDIC”) as SVB’s receiver. Just two days later, the New York State Department of Financial Services took over another bank, Signature Bank, and appointed the FDIC as receiver. And, yesterday, the share price of various European banks plunged following record one-day selloffs.