Silicon Valley Bank Shares Plunge 60%: What Happened and What’s Next?

Silicon Valley Bank’s (SVB) stock has plummeted by 60%, resulting in over $80 billion in value being wiped out from bank shares. SVB Financial Group launched a $1.75 billion share sale on Wednesday to plug a $1.8 billion hole caused by the sale of a $21 billion loss-making bond portfolio consisting mostly of U.S. Treasuries.

The move has caused concern among investors in the technology startup sector, for which SVB serves as a crucial lender. SVB CEO Gregory Becker has called clients to assure them their money with the bank is safe.

However, some startups, including Peter Thiel’s Founders Fund, are advising their founders to pull out their money from SVB as a precautionary measure. In response to the situation, SVB said the funds raised from the stock sale will be re-invested in shorter-term debt and the bank will double its term borrowing to $30 billion.

Despite these measures, bank stocks remain under pressure from “risk-off sentiment” and questions about systemic risks to the industry.

 

SVB Financial Group Stock Forecast:

Based on the SVB Financial Group stock forecasts from 24 analysts, the average analyst target price for SVB Financial Group is USD 323.02 over the next 12 months. SVB Financial Group’s average analyst rating is Buy.

Stock Target Advisor’s own stock analysis of SVB Financial Group is Slightly Bearish, which is based on 4 positive signals and 5 negative signals. At the last closing, SVB Financial Group’s stock price was USD 106.04. SVB Financial Group’s stock price has changed by -61.74% over the past week, -66.43% over the past month, and -80.32% over the last year.

SIVB Ratings by Stock Target Advisor

Company Profile:

SVB Financial Group, a diversified financial services company, offers various banking and financial products and services. It operates through four segments: Silicon Valley Bank, SVB Private, SVB Capital, and SVB Securities. The company was founded in 1983 and is headquartered in Santa Clara, California.

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