From the point of view of the authorities, the end of the German branch of the Silicon Valley Bank does not pose a threat to financial stability.
(Photo: REUTERS)
Frankfurt The financial regulator Bafin is closing the German branch of Silicon Valley Bank. The authority announced on Monday that it had “issued a ban on sale and payment to the Silicon Valley Bank Germany Branch due to the existing risk to the fulfillment of obligations to creditors”. In addition, the Bafin ordered the bank “to be closed for dealings with customers,” according to the authority.
The Silicon Valley Bank has also been represented in Germany since 2018. However, the German branch was only allowed to grant loans and not accept deposits. Credit customers were generally young, mostly loss-making companies. According to the end of 2022, the balance sheet total amounted to 789.2 million euros.
According to Bafin, the German subsidiary is “not of systemic relevance” and therefore “not a threat to financial stability”. The moratorium should apply until the further development of the US parent company has been clarified.