Hedge funds are offering to buy startups’ deposits at Silicon Valley Bank (SVB) for as little as 60 cents per dollar, Semafor report on Saturday, citing people familiar with the matter.
Bid bids ranged from 60 to 80 cents on the dollar, the report said, adding that the range reflects expectations of how much uninsured deposits will eventually be recovered after the bank’s assets are sold or dissolution.
Companies like Oaktree known for investing in bad debts are contacting startups after SVB
SIVB,
seized by the Federal Deposit Insurance Corporation (FDIC), the report said.
Traders from investment bank Jefferies are also contacting startup founders with bank deposits, offering to buy their deposits at a discounted price, Information separate report.
The report says Jefferies is offering at least 70 cents per dollar on deposit claims, citing several people with direct knowledge of the matter.
Oaktree declined to comment on the reports. Jefferies could not be immediately reached for comment.
The Silicon Valley bank was taken over by the US Federal Deposit Insurance Corporation on Friday after depositors, concerned about the financial health of their lenders, rushed to withdraw their deposits. . The two-day run on the bank stunned the market, wiping out more than $100 billion in market value for US banks.
See: Silicon Valley Bank branches closed by regulator in biggest bank bust since Washington Mutual
