KPMG LLP has reportedly been sued as SVB’s auditor, along with underwriters like Goldman Sachs, Morgan Stanley, Bank of America and others
Days after the Silicon Valley Bank (SVB) collapse triggered a potential banking crisis, now; a lawsuit has reportedly alleged some misstatements. As per reports, KPMG LLP has been sued as SVB’s auditor, along with underwriters like Goldman Sachs, Morgan Stanley, Bank of America and others.
According to a Bloomberg report, these entities have been sued in an investor lawsuit based on alleged misstatements leading to the failure and the collapse of the Silicon Valley Bank (SVB crisis). The complaint has reportedly been filed on Friday in the federal court in San Francisco. It reportedly names SVB CEO Greg Becker and other directors and officers of the bank as defendants.
The report adds that as per the lawsuit, collectively, the defendants “misrepresented the strength of the company’s balance sheet, liquidity, and position in the market.” The further also reportedly “understated and concealed the magnitude of the risks” that were dawning on the bank and hence, also allegedly undermined the value of its own securities portfolio.
The SVB collapse triggered a potential banking crisis in the system and also reportedly exposed the various problems prevalent in the US banking system. The bank collapsed following bets on bonds that lost value as interest rates rose after various decisions by the US Federal Reserve (Fed).
As per several media reports, SVB’s CEO also apologised to all the depositors and customers for the bank’s collapse. However, the entity also asked depositors to have faith in the system again and ehlp build back the Silicon Valley Bank. It must be noted that the fall of SVB also led to the fall of another New York-based bank, the Signature Bank.