Silicon Valley Wealth Unit Could be Sold Separately by the FDIC

According to federal regulators, Silicon Valley Bank might be sold in pieces. Also, they are giving potential suitors more time to respond.

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Silicon Valley Bridge Bank and its wealth management business, SVB Private, will be up for sale separately, according to the Federal Deposit Insurance Corp., which seized command of the Bay Area bank on March 10.

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According to Trade Algo, which cited unnamed sources, the FDIC had attempted to sell the units collectively over the weekend. Bids were initially due Sunday, but the FDIC later informed prospective bidders that the time had been extended.

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According to the FDIC, bids on the bridge bank will be accepted until 8 p.m. EDT on March 24, a Friday. Around eight o'clock, the SVB Private auction will end. Wednesday, March 22, EDT.

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The FDIC and the bidders "require more time to investigate all options in order to achieve the greatest value and reach an ideal solution," the government agency stated. "There has been strong interest from numerous parties.

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The procedure might result in a faster sale of the financial advisory division, which business insiders said is more appealing as a standalone operation. The unit most reported recently managing assets at close to $16 billion. 

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The wealth management industry has had constant increase in merger and acquisition activity in recent years, which coincides with the auction. According to a research from financial institution and consultant Echelon Partners, registered investment advisors' M&A agreements broke records last year. In 2022, there were 340 transactions, which was a 10.7% rise over 2021 and the 10th straight annual record.

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The wealth division of Silicon Valley Bank may be of interest to RIA aggregators, private equity companies, and other banks.

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