US Taps Piper Sandler in New Bid to Sell SVB

Regulators at the U.S. Federal Deposit Insurance Corp. (FDIC) have tapped investment bank Piper Sandler Companies to relaunch the auction of failed lender Silicon Valley Bank, people familiar with the matter said Wednesday.

The development shows how the FDIC is preparing a concerted effort to sell Silicon Valley Bank (SVB) after regulators took it over last Friday and agreed on Sunday to guarantee all of its deposits. A weekend action launched by FDIC to sell SVB failed on Sunday after major banks balked at carrying out such a risky deal in a short amount of time.

The FDIC will try to sell SVB in its entirety but also explore piecemeal deals, one of the sources said. The parent of Silicon Valley Bank, SVB Financial Group, said on Monday it was separately exploring options for its other assets, that include an investment bank and an investment business.

The sources requested anonymity because the matter is confidential. The FDIC, SVB and Piper Sandler did not immediately respond to requests for comment.

U.S. President Joseph Biden has said that U.S. taxpayers will not bear the cost of salvaging SVB because any capital shortfalls would be covered by a government fund that can place a levy on other banks. A successful sale of SVB by the FDIC, however, would help minimize such shortfalls.

SVB became last week the biggest U.S. bank to fail since the 2008 financial crisis, spreading jitters across the banking sector and raising doubt about the future of startups that turned on the technology-focused lender for new debt financing.

Among the banks that studied but decided against an offer during last weekend's auction for SVB were PNC Financial Services and Royal Bank of Canada, which owns California-focused lender City National Bank, Reuters has reported.