People queue up outside the headquarters of the Silicon Valley Bank (SVB) in Santa Clara, California, the United States, March 13, 2023. [Photo/Xinhua]
The U.S. Securities and Exchange Commission and the Justice Department are investigating how the collapse of Silicon Valley Bank (SVB) became the second largest bank failure in the country's history, The Wall Street Journal (WSJ) reported on Tuesday.
The probes, which are separate and in preliminary phases, include looking into the stock sales that SVB executives' conducted ahead of the tech-focused bank's collapse, according to the report.
"Prosecutors and regulators often open investigations after financial institutions or public companies suffer big, unexpected losses. Shares in SVB Financial Group, which formerly owned the bank, fell 60 percent last week and have been stopped from trading since Friday," said WSJ.
"The demise of Silicon Valley Bank, as well as crypto-focused Signature Bank over the past few days, prompted extraordinary rescue action from regulators and caused a financial shock that rocked markets, especially shares of regional banks," said CNBC in its report of the development.
In addition to backstopping the deposits at SVB and Signature Bank, federal regulators also announced an additional funding facility for troubled banks.
Daniel Beck, CFO of SVB, sold 2,000 shares of SVB Financial on Feb. 27, the same day that CEO Gregory Becker exercised options on 12,451 shares and sold them, regulatory filings showed.
