A week after Silicon Valley Bank collapsed and was seized by the US government, its parent firm SVB Financial Group filed for Chapter 11 bankruptcy on Friday, AP reported. This comes as shares of big US banks fell between 1.5-2 per cent in premarket trading on Friday.

SVB Financial Group is no longer affiliated with Silicon Valley Bank after its seizure by the Federal Deposit Insurance Corporation. The bank’s successor, Silicon Valley Bridge Bank, is being run under the jurisdiction of the FDIC and is not included in the Chapter 11 filing. Thus, the bankruptcy process will be separate from the sale of Silicon Valley Bank’s assets.

SVB Financial Group believes it has approximately $2.2 billion of liquidity. It also said it has other valuable investment securities accounts and other assets that are being considered for sale, AP reported.

READ | Silicon Valley Bank Debacle And A Lesson For India’s Banking Sector

“The Chapter 11 process will allow SVB Financial Group to preserve value as it evaluates strategic alternatives for its prized businesses and assets, especially SVB Capital and SVB Securities,” William Kosturos, Chief Restructuring Officer for SVB Financial Group, said in a statement.

SVB Capital is the company’s venture capital and private credit fund. SVB Securities is a regulated broker-dealer. Both continue to operate and have sources of funding, the company said.

The FDIC took over Silicon Valley Bank last Friday after depositors withdrew $42 billion in one day, about a quarter of its total deposits. Officials have since tried to sell the bank without success.

SVB specialised in financing tech companies and 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.

The main cause of the failure was an asset-liability mismatch and slower credit growth than the deposit growth.

Hundreds of Indian startups had more than a billion dollars of their funds in SVB, Union Minister Rajeev Chandrashekhar had said earlier this week.

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