Germany’s financial regulator froze Silicon Valley Bank’s branch in the country after the sudden collapse of the U.S lender.
(Bloomberg) — Germany’s financial regulator froze Silicon Valley Bank’s branch in the country after the sudden collapse of the U.S lender.
Silicon Valley Bank Germany Branch will not be allowed to sell assets or make payments because it’s at risk of not being able to fulfill commitments to creditors, BaFin, as the regulator is known, said in a statement on Monday. The bank also has to close its client business.
The German operations don’t pose a danger to financial stability, BaFin said. The Frankfurt-based institution’s balance sheet amounted to €789.2 million ($842.3 million) at the end of last year and it doesn’t take deposits, according to the regulator.
The Association of German Banks, a lobby group, confirmed that the country’s deposit insurance won’t be needed.
SVB’s collapse won’t have an effect on the German banking system, the lobby said in a statement in response to questions from Bloomberg.
“German banks are robust, stable and resilient,” the lobby group said. “They massively increased their capital since 2008.”
(Updates with statement from German bank lobby in fourth paragraph)
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