The panic over the status of Silicon Valley Bank intensified on Friday, as the stock of SVB’s parent fell another 66% in pre-trading hours. Meanwhile, anxieties spread to China overnight, prompting local venture capitalists and entrepreneurs to follow their U.S. counterparts and look for alternative banks for their U.S. dollar holdings.
The fate of SVB is a huge concern in China, the world’s second-largest venture capital market after Silicon Valley, because SVB was among the first financial institutions to start catering to Chinese startups when traditional banks shunned them. The bank established its first Chinese arm nearly two decades ago,
“Silicon Valley Bank has played an instrumental role for us,” said Guanchun Wang, founder of Laiye, a Beijing-based enterprise software startup. “We opened our first bank account with them when the likes of Citi wouldn’t have anything to do with us.”