Canadian regulator takes control of Silicon Valley Bank’s Canadian branch

By Akriti Sharma & Nia Williams

(Reuters) – A Canadian regulator declared on Sunday that it would temporarily take control of the Canadian branch of Silicon Valley Bank, following the global fallout from the collapsed U.S.-focused lender.

According to the Office of the Superintendent of Financial Institutions, it wants to take permanent control of the assets of the Canadian unit. It also asked the Attorney General of Canada for a petition to grant a winding up order.

“By taking temporary control of the Canadian branch of Silicon Valley Bank, we are acting to protect the rights and interests of the branch’s creditors,” Peter Routledge, superintendent of financial institution, stated in a statement.

The U.S. authorities were in the process of preparing “material action” According to sources familiar with the matter, the bank will try to protect deposits and stem the financial fallout of the sudden collapse on Sunday.

OFSI stated that the U.S.-based bank has been operating in Canada since 2019, as a branch of a foreign bank based in Toronto. Its primary business in Canada is lending to corporate clients. The branch does not have any individual or commercial deposits in Canada.

According to regulatory filings, the Canadian unit had C$435million ($315.33 Million) in secured loans at year’s end. This is more than twice the amount at year’s end.

A Bloomberg report claims that the collapse of SVB Financial Group has caused another setback for Canadian advertising-tech company AcuityAds Holdings Inc. It revealed that nearly all its cash was held at the bank.

($1=1.3795 Canadian dollars)

(Reporting by Akriti in Bengaluru, edited by Leslie Adler, Diane Craft and Jonathan Oatis