S&P lowered its rating on SVB to BBB- from BBB, leaving it just one notch above its junk rating. SVB anticipates clients will continue to burn cash at essentially the same level as they did in the last quarter of 2022, when economic tightening was already well underway.Īnalysts at DA Davidson wrote in a report on Thursday that in terms of spending, 'companies have not adjusted to the slower fundraising environment.' The firm has a neutral rating on the stock and said concerns 'over a slow to recover VC environment have kept us cautious on SIVB shares.' That forecast is now down to $167 billion to $169 billion. In January, SVB expected average deposits for the first quarter to be $171 billion to $175 billion. 'Client cash burn remains ~2x higher than pre-2021 levels and has not adjusted to the slower fundraising environment,' SVB said. Total client funds have fallen for the last five quarters, as cash burn has continued at a rapid pace despite the slowdown in venture investing. 'Losing a major debt provider in the venture debt market could drive the cost of funds up,' Orn said.Īccording to SVB's mid-quarter update, one of the primary problems the bank faces has to do with the amount of money its customers are spending. Personal Loans for 670 Credit Score or Lower
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