Goldman Says U.S. Is Investigating Its Work for Silicon Valley Bank

U.S. authorities are investigating the work Goldman Sachs did for Silicon Valley Bank in the weeks before it failed, including its advice that the smaller lender sell a large portfolio of securities at a loss, according to a regulatory filing by Goldman on Thursday.

Goldman said it was “cooperating with and providing information to various governmental bodies in connection with their investigations and inquiries” into Silicon Valley Bank, which collapsed suddenly on March 10, touching off a crisis of confidence that has led to the failure of two more regional lenders, and a panic in the stock market over the fate of others.

The investigations include “the firm’s business with SVB in or around March 2023, when SVB engaged the firm to assist with a proposed capital raise and SVB sold the firm a portfolio of securities,” Goldman’s filing to the Securities and Exchange Commission said.

Investment bankers at Goldman advised Silicon Valley Bank’s leaders to sell a $21 billion portfolio of U.S. government debt whose value had been greatly diminished by rising interest rates. Silicon Valley Bank did so in a matter of hours, then revealed it had taken a $1.8 billion loss on the move. Goldman also tried to arrange the sale of Silicon Valley Bank’s stock.

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