Kaskela Law LLC announces that a shareholder class action lawsuit has been filed against SVB Financial Group (“SVB” or the “Company”) (NASDAQ: SIVB) on behalf of investors who purchased shares of the Company’s common stock between June 16, 2021 and March 10, 2023, inclusive (the “Class Period”).
According to the complaint, during the Class Period, SVB and certain of the Company’s senior executive officers issued a series of false and misleading statements to investors concerning the Company’s business, operations and prospects. Specifically, defendants are alleged to mislead investors and/or failed to disclose: (i) the risks presented by impending rising interest rates; (ii) that, in an environment with high interest rates, SVB would be worse off than banks that did not cater to tech startups and venture capital-backed companies; and (iii) that if SVB’s investments were negatively affected by rising interest rates, the Company was particularly susceptible to a bank run.
On March 8, 2023, SVB issued a press release disclosing that it had “completed the sale of substantially [all] of its available for sale securities portfolio,” selling “approximately $21 billion of securities, which will result in an after tax loss of approximately $1.8 billion in the first quarter of 2023.” Following this news, shares of the Company’s stock declined $161.79 per share, or over 60% in value, to close on March 9, 2023 at $106.04.
Subsequently, on March 10, 2023, trading in the Company’s shares was halted, and the California Department of Financial Protection and Innovation (“DFPI”) took over SVB and transferred the bank’s deposits to the Federal Deposit Insurance Corporation (“FDIC”). The California DFPI’s Order reported that (i) The Bank’s liquidity position is inadequate, and it cannot reasonably be expected to pay its obligations as they come due; (ii) The Bank is insolvent; and (iii) The Bank is conducting its business in an unsafe manner due to its present financial condition.
IMPORTANT DEADLINE: Investors who purchased SVB common stock during the Class Period and suffered a financial loss may, no later than May 12, 2023, seek to be appointed as a lead plaintiff representative in the action through Kaskela Law LLC or other counsel.