Silicon Valley Bank Credit Rating - Moody's (2024)

FAQs

What is Moody's credit rating for Silicon Valley Bank? ›

Moody's slashed its credit ratings on Silicon Valley Bank's long-term local currency bank deposit to Caa2 from A1 and issuer ratings to C from Baa1.

Moody's re-affirmed its long-term foreign currency issuer rating for YES Bank at Ba3, long-term (local and foreign currency) deposit rating at Ba3, baseline credit assessment (BCA) and adjusted BCA at b1 and senior unsecured (Foreign Currency) medium-term note program at (P)Ba3.

In February 2023, Forbes listed the bank as #20 of "America's Best Banks" with a 13.8% return on equity. In March 2023, Moody's Investors Service rated the bank's loan portfolio as conservative and high-performing. The bank's overseas subsidiaries held $13.9 billion in deposits.

Aaa Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level of credit risk. Aa Obligations rated Aa are judged to be of high quality and are subject to very low credit risk. A Obligations rated A are judged to be upper-medium grade and are subject to low credit risk.

Moody's downgraded the bank, but only by a notch because of SVB's bond portfolio sale and plan to raise capital.

How Moody's Credit Ratings Work. Moody's analysts conduct in-depth evaluations of the financial health, management practices, industry trends, and economic conditions of the entity being rated. They analyze various quantitative and qualitative factors to form an understanding of the entity's credit risk.

Upgraded to Care AA+ Rating from Care AA for Perpetual and Additional Tier I Bonds (Basel III); Stable Outlook.

Those placed on review for downgrade are giants: BNY Mellon, Northern Trust, State Street, Cullen/Frost Bankers, Truist Financial and US Bancorp. It has been five months since the collapse of Silicon Valley Bank, the Bay area bank well-known for its services tailored to the venture capital industry.

SVB was a pioneer of what is known as venture debt, a type of loan offered by banks and nonbank lenders specifically designed for early-stage, high-growth companies with VC backing. The vast majority of VC-backed companies now raise debt at some point from banks such as SVB.

A bank run on Silicon Valley Bank led the Federal Deposit Insurance Corporation to take control of the bank Friday in the second-largest bank failure in US history. The FDIC insures depositors up to $250,000, but as many larger companies used SVB as their bank, they had a lot more than that in their accounts.

What was SVB bank rating before collapse? ›

When the financial system collapsed, investors were blindsided, and a cascade of bank runs ensued. Similarly, until its last gasp, SVB enjoyed an A rating — an “upper medium” grade, meaning it was at a low risk, overall, of failing to meet its financial obligations.

Charles Schwab & Co., Inc. Moody's Long-Term Rating Definitions: Aaa: Obligations rated Aaa are judged to be of the highest quality, with minimal credit risk.

Highlights: While older models of credit scores used to go as high as 900, you can no longer achieve a 900 credit score. The highest score you can receive today is 850. Anything above 800 is considered an excellent credit score.

The rating scale, running from a high of Aaa to a low of C, comprises 21 notches. It is divided into two sections, investment grade and speculative grade. The lowest investment-grade rating is Baa3. The highest speculative-grade rating is Ba1.

SVB's received an overall composite CAMELS rating of 2. Institution Rating System. The system is supposed to evaluate significant financial and operational factors that impact a bank's safety and soundness.

New York, August 07, 2023 -- Moody's Investors Service ("Moody's") has today placed the long-term ratings and long-term assessments for Truist Financial Corporation ("Truist"), its lead bank subsidiary, Truist Bank, and its rated subsidiaries, National Penn Bancshares, Inc., SunTrust Banks, Inc., National Commerce ...