Blackstone, Apollo, KKR Eye SVB's Assets
Investment giants Blackstone, KKR and Apollo Global Management are reportedly interested in acquiring loans held by Silicon Valley Bank, which was seized by regulators on Friday, representing the second-largest bank failure in U.S. history.
The exact scope of their interest in SVB's loan portfolio isn't clear yet, Bloomberg reports, citing unnamed sources. All together, SVB has $73.6B in loans on its books, including $2.6B of CRE loans. It also owns an investment securities portfolio containing $1.3B in qualified affordable housing projects and $14.4B in agency-issued commercial mortgage-backed securities.
Unlike some of the bonds held by SVB, which the bank had been forced to sell at a loss as depositors clamored for their money late last week, the real estate loan portfolio wasn't seen as a factor in the collapse of the bank.
As of Monday, depositors had access to their accounts at the bank, which is now being operated by the Federal Deposit Insurance Corp. Over the weekend, federal regulators issued a statement that depositors whose accounts exceeded the $250K limit on FDIC-insured deposits would also be made whole, paid for by a special assessment on banks.
The FDIC also tried to find a buyer for the entire bank on Sunday, but there were no takers. The agency is going to try again soon, the Silicon Valley Business Journal reports, which may forestall any acquisition of the bank's assets piecemeal.
Separately, the Justice Department and the Securities and Exchange Commission are investigating the collapse of SVB, The Wall Street journal reports. The Federal Reserve has launched an internal review of its actions before the failures of SVB and Signature Bank, which was shut down by regulators Sunday.
The successive failures sent shockwaves through the business world over the past week, although government actions appear to have stabilized the market — share prices of regional banks rebounded Tuesday morning. Nevertheless, real estate finance experts told Bisnow Monday that SVB and Signature's implosions will likely lead to less credit being available to property owners.
