(Bloomberg Opinion) — The US government should consider a “highly dilutive” bailout of SVB Financial Group if a private equity solution cannot be provided, according to Pershing Square founder Bill Ackman.
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Venture capital backed companies use SVB for both lending and operating cash. The government could also choose to guarantee deposits in exchange for warrants to allow the company to raise new funds, he said.
SVB Financial Group chief executive Greg Becker moved on Thursday to quash concerns about the bank’s financial position, advising clients to “remain calm.”
SVB races to avoid bank run as fund giants advise cashing out
The banks’ clients include venture capitalists and Becker asked them to support the lender just as he has supported them for the past 40 years, according to people familiar with the matter.
Bear Stearns, the investment firm that went bankrupt during the 2008 global financial crisis, was later bought by JPMorgan Chase & Co., a move CEO Jamie Dimon said he regretted making.
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