• Silicon Valley Bank (SVB) collapsed on Friday morning after its clients began rapidly withdrawing money.
  • SEC filings show SVB President and CEO Gregory Becker sold $3,578,652.31 in common stock two weeks before the bank’s collapse.
  • SVB’s other executives had been dumping stock since May 2021.
  • On Friday, the Federal Deposit Insurance Corporation (FDIC) was appointed by the California Department of Financial Protection and Innovation to take control of SVB.

The CEO of Silicon Valley Bank (SVB) sold more than $3.5 million in stocks weeks before the tech lender collapsed on Friday morning, federal filings show.

A February 27 filing with the U.S. Securities and Exchange Commission (SEC) shows that SVB President and CEO Greg Becker sold $3,578,652.31 in common stock two weeks before SVB was shut down by federal regulators on Friday morning. The $3.5 million accounted for 10 percent of the stocks he had, since he sold 12,451 of his roughly 98,000 shares.

A separate SEC filing shows that the bank’s Chief Financial Officer Daniel Beck also sold $575,180 in stocks that the same February day.

After a tumultuous 48 hours, federal regulators took over SVB after the financial institution suffered the second-largest bank failure in U.S. history, the biggest since Washington Mutual in 2008.

Many of SVB’s clients began withdrawing money in recent months after the tech sector was hit particularly hard by the Federal Reserve’s aggressive interest rates hikes hits last year. When the bank informed clients that it had to sell part of its bond holdings to make good on those withdrawals earlier this week, people began to withdraw even more money.

Silicon Valley Bank Stock
Greg Becker, President and CEO of Silicon Valley Bank, speaks during the Milken Institute Global Conference on May 3, 2022, in Beverly Hills, California. Inset: The shuttered Silicon Valley Bank headquarters on March 10, 2023, in Santa Clara, California.
Patrick T. Fallon/Justin Sullivan/AFP

On Thursday, stock prices fell by 60 percent. By Friday morning, trading was halted and by midday, the Federal Deposit Insurance Corporation (FDIC) was appointed by the California Department of Financial Protection and Innovation to take control of SVB.

In a press release announcing the receivership, FDIC said, “As of December 31, 2022, Silicon Valley Bank had approximately $209.0 billion in total assets and about $175.4 billion in total deposits.”

“At the time of closing, the amount of deposits in excess of the insurance limits was undetermined,” the statement read. “The amount of uninsured deposits will be determined once the FDIC obtains additional information from the bank and customers.”

Asked about the February 27 filings, a SEC spokesperson told Newsweek the agency would decline for comment on filings related to a specific individual. Newsweek also reached out to Becker and Beck for comment.

Additional filings show that SVB’s CEO, CFO and other executives have been dumping stock as early as May 2021.

Based in Santa Clara, California, SVB had been a key player in the tech and venture capital realm, successfully competing with bigger-name banks, even during the pandemic.

But the Fed’s high-interest rates have ramped up pressure for the bank to raise more cash. Instead of making money off its mortgage-backed securities, SVB lost money due to the hikes and was forced to sell other investments, which spooked a growing number of clients into withdrawing their money from the bank, effectively causing a bank run.

The bank had 17 branches in California and Massachusetts. The FDIC said that all branches will reopen on Monday and SVB’s official checks will continue to clear.

Although Friday’s collapse seems to be isolated and unlikely to spread to the rest of the banking shelter, shares of all kinds of lenders were down about five percent on Thursday.