Canada Takes Temporary Control Over its Branch of Silicon Valley Bank after Failure

By Staff, Agencies

The Canadian authorities have taken temporary control of the assets of the Canadian branch of the Silicon Valley Bank [SVB] after the latter's collapse, Canada’s Office of the Superintendent of Financial Institutions [OSFI] said.

"Today, the Superintendent of Financial Institutions moved to protect creditors by taking temporary control of the assets of the Canadian branch of Silicon Valley Bank, as well as issuing notice that he intends to seek permanent control of its assets and requesting that the Attorney General of Canada apply for a Winding-Up Order," the OSFI said in a statement on Sunday.

The statement specified that the Canadian SVB branch lends to corporate clients and does not hold any commercial or individual deposits in Canada.

"Since the onset of the bank’s difficulties, OSFI has closely monitored Silicon Valley Bank’s Canadian branch. Taking temporary control of the assets of the branch is the latest action taken by OSFI," the statement said.

The California Department of Financial Protection and Innovation announced on Friday that it was taking possession of SVB, citing inadequate liquidity and insolvency. The SVB became the largest bank to fail in the US after the 2007–2008 financial crisis.

To protect insured depositors, the Federal Deposit Insurance Corporation [FDIC] has created the Deposit Insurance National Bank of Santa Clara [DINB], to which all insured deposits of SVB were transferred.