Bond Losses Push Silicon Valley Bank Parent to Raise Capital

SVB Financial Group’s shares fell sharply after it said it had sold large portions of its securities portfolio and would raise fresh capital, highlighting a broader problem for U.S. lenders who have seen rising interest rates hammer the values of their bond holdings.

SVB, the parent of Silicon Valley Bank, late Wednesday said it would book a $1.8 billion after-tax loss on sales of investments and seek to raise $2.25 billion by selling a mix of common and preferred stock. The bank’s assets and deposits almost doubled in 2021, large amounts of which SVB poured into U.S. Treasurys and other government-sponsored debt securities. Soon after, the Federal Reserve began its rate-hiking campaign.