Silicon Valley Bank Drops Another 60% and Is Halted, as Pressure Mounts on Banking Sector

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NEW: Shares of Silicon Valley Bank are halted after tumbling for a second straight day, down 61% in premarket trading.

down 0.41% early Friday after tumbling 5% on Thursday."Current pressures facing SIVB are highly idiosyncratic and should not be viewed as a read-across to other banks," wrote analysts Manan Gosalia and Betsy Graseck with Morgan Stanley in a note Friday.Concern among founders and venture capital investors spiked earlier this week after Silicon Valley Bank surprised the market by announcing late Wednesday it needed to raise $2.25 billion in stock.

The mounting pressures on SVB prompted hedge fund billionaire Bill Ackman to speculate that if private investors can't help shore up confidence in the California lender, a government bailout could be next.could destroy an important long-term driver of the economy as VC-backed companies rely on SVB for loans and holding their operating cash. If private capital can’t provide a solution, a highly dilutive gov’t preferred bailout should be considered.

 

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