SVB And FDIC May Be At Cross-Purposes In Ch. 11March 22, 2023 – Media Mention
Jonathan Shenson, a Partner in the firm's Bankruptcy, Reorganization, & Capital Recovery Group, recently shared his outlook with Law360 regarding Silicon Valley Bank Financial Group’s recent Chapter 11 bankruptcy filing.
The FDIC actions are designed to preserve the parent company's cash in the event it is needed to satisfy claims the bank might have once all the depositors have been protected, said Jonathan Shenson of Greenberg Glusker LLP.
"To the extent the debtor and its subsidiaries have cash and other assets with the bank, those assets could potentially be subject to setoff rights the bank may have, to the extent the bank has claims against those entities," Shenson said.
"If the entities are profitable or worth something, presumably there will be someone prepared to provide capital," Shenson said.
"There is a lot going on right now, and my guess is the holding company is laser-focused on those issues, but it probably isn't the highest priority for the bank," Shenson said. "The FDIC is focused on finding a successor bank."