SVB Financial Group of Santa Clara, Calif., said it will shut down its money-losing investment banking unit, SVB Alliant.
Investors have pressured the $5.8 billion-asset SVB to dispose of the unit, which has lost money for four years, including $467,000 in the first quarter. SVB had said in a regulatory filing in May that it was considering spinning off the unit to its management.
"While we had hoped to preserve the synergies we saw in SVB Alliant through a more independent ownership arrangement … we were not able to agree on the terms of that arrangement," Kenneth Wilcox, SVB's president and chief executive officer, said in a press release Wednesday.
SVB said it will report second-quarter earnings of 55 to 61 cents a share Thursday, including a goodwill impairment charge of $17.2 million, or 27 cents a share, on Alliant.
This quarter the company said it expects to incur costs (which it did not quantify) associated with the unit's closure.
