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 federal regulators shut down SVB on Friday morning.
The $3.5 million accounted for 10 percent of his stocks since he sold 12,451 of his roughly 98,000 shares.
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A separate SEC filing shows that the bank’s Chief Financial Officer, Daniel Beck, sold $575,180 in stocks on the same February day.
Federal regulators took over SVB after the financial institution’s second-largest bank failure in U.S. history, the biggest since Washington Mutual in 2008.
SVB announced Thursday it had suffered a tax loss of roughly $1.8 billion, after it sold approximately $21 billion of securities to raise cash quickly amid challenging market conditions.
It also announced plans to raise $2.25 billion by selling common and preferred stock.
Hours later, venture capital firm Founders Fund advised companies it backed to withdraw money from SVB, Bloomberg reported. At the same time, some founders moved their money from SVB to other firms, including Brex and First Republic, according to Barrons.
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SVB Financial shares were halted Friday morning following a massive pre-market selloff, resulting in shares plunging 64% in pre-market trading by 8 a.m., hitting a low of $34.
News of the sale was first broken by Barrons Friday afternoon, just hours after California’s financial regulator closed the bank, telling insured depositors they will have full access to their deposits by Monday morning.
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