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Summary of Dodd-Frank Act Stress Test Results
Under Supervisory Severely Adverse Scenario
As of July 29, 2016
I. Introduction
A. Background
SVB Financial Group, a U.S. bank holding company (“SVBFG” or the “Company”), is
disclosing the results of its 2016 company-run stress test as required by the Dodd-Frank Wall
Street Reform and Consumer Protection Act (“Dodd-Frank Act”) and the regulations (“DFAST
rules”) implemented by the Board of Governors of the Federal Reserve System (“Federal
Reserve”) thereunder. The DFAST rules require bank holding companies (“BHCs”) with more
than $10 billion but less than $50 billion in total consolidated assets, such as SVBFG, to perform
annual company-run stress tests to assess the potential impact of at least three macroeconomic
scenarios prescribed by the DFAST rules – “baseline”, “adverse” and “severely adverse” – on
their consolidated balance sheet (including risk-weighted assets), net revenues, losses, and
capital. The stress tests are intended to assess the potential impact of hypothetical economic
scenarios on the Company’s operations and capital adequacy over a defined nine quarter
planning horizon.
Under the DFAST rules, SVBFG is required to publicly disclose the results of its
company-run stress tests specifically under the hypothetical severely adverse economic
scenario (“Supervisory Severely Adverse Scenario”). This scenario was released by the Federal
Reserve on January 28, 2016, in the “2016 Supervisory Scenarios for Annual Stress Tests
Required under the Dodd-Frank Act Stress Testing Rules and the Capital Plan Rule.” The
Supervisory Severely Adverse Scenario is characterized by a hypothetical severe global
recession, accompanied by a period of heightened corporate financial stress and negative yields
for short-term U.S. Treasury securities, where the level of U.S. real gross domestic product
begins to decline in the first quarter of 2016, reaching a trough in the first quarter of 2017. The
unemployment rate increases and inflation rises, while asset prices, including equity prices and
real estate prices, decline.
This summary of SVBFG’s company-run stress test results contains: (i) a description of
the types of risks included in the Supervisory Severely Adverse Scenario stress test; (ii) a
summary description of the methodologies used in such stress test; (iii) estimates of certain
financial results and pro forma capital ratios after applying such stress test; and (iv)
explanations of the most significant causes for the changes in regulatory capital ratios.
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This summary also contains the company-run stress test results under the Supervisory
Severely Adverse Scenario for the Company’s principal banking subsidiary, Silicon Valley Bank
(the “Bank”), as required by the DFAST rules. The Bank is a California state-chartered Federal
Reserve member bank that is also subject to annual stress test requirements under the DFAST
rules.
B. Considerations Regarding the Results Disclosed
In reviewing the results disclosed in this summary, the following should be considered:
• The planning cycle of the stress test results set forth in this summary spans a nine
quarter planning horizon, from the beginning of the first quarter of 2016 through
the end of the first quarter of 2018 (“9Q Planning Horizon”).
• The Supervisory Severely Adverse Scenario describes a set of hypothetical conditions
designed to assess the strength of banking organizations and their resilience to
severely adverse economic environments. The scenario is not a forecast of
economic conditions and investors should not view or rely on the results disclosed
herein as forecasts of actual financial results for SVBFG or the Bank. The Company’s
future financial results and conditions may be influenced by actual economic and
financial conditions and risks described in the Company’s Annual Report on Form
10-K or its quarterly reports on Form 10-Q (as filed with the Securities and Exchange
Commission), as well as unforeseen factors.
• The results of SVBFG’s stress test, including the impact on regulatory capital ratios,
are driven by SVBFG’s capital composition and the overall mix of assets and
off-balance sheet exposures. The majority of SVBFG’s risk assets are comprised of
high-quality fixed-income investment securities that contribute a relatively small
amount to total regulatory risk-weighted assets.1 As a result, changes in SVBFG’s
regulatory capital caused by conditions under the Supervisory Severely Adverse
Scenario come primarily from changes in loan volume, off-balance sheet exposures
(such as unfunded commitments to lend), credit quality, and to a lesser extent, the
impact on noninterest income from changes in non-marketable investments and
warrant assets.
• Noninterest expense is comprised primarily of salary (fixed) and performance-based
compensation (variable) and “in-process” infrastructure projects. Noninterest
expense projected in the Supervisory Severely Adverse Scenario is lower than would
otherwise be projected under normal conditions due primarily to reductions in
performance-based compensation and infrastructure spending. This assumption
1 As of December 31, 2015, SVBFG’s fixed-income investment portfolio totaled $25.2 billion (the sum of the
Company’s total held-to-maturity securities and total available-for-sale securities, as reported in the Company’s
FR Y-9C Schedule HC-B as of the same date), which represented 56% of SVBFG’s total consolidated assets. For
purposes of calculating regulatory capital ratios, SVBFG’s fixed-income investment portfolio had a composite
regulatory risk-weight of approximately 5%, compared to a regulatory risk-weight of 100% for net funded loans.
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reflects an enhancement to our modelling methodology (compared to the prior
year) and is consistent with the Company’s historical behavior under economic
stress.2
II. Risks Included in SVBFG’s Company-Run Stress Test
SVBFG’s stress test results specifically include the following four risk categories, which
are incorporated primarily through quantitative models:
• Credit Risk. Credit risk is the risk of loss resulting from the failure of a borrower or
counterparty to meet its financial or contractual obligations to the Company and its
subsidiaries. Under stressed economic conditions, the likelihood of credit losses
may increase due to the failure of SVBFG’s borrowers and counterparties to meet
their obligations.
• Market/Liquidity Risk. Market risk is the risk of adverse fluctuations in the market
value of financial instruments due to changes in market interest rates. Market risks
include foreign currency exchange risk and equity price risk. Liquidity risk is the risk
to current or anticipated earnings or capital arising from an inability to meet
obligations when they come due or to fund unexpected changes in business volume.
Increases in loan utilizations and/or deposit attrition, as well as decreases in the
market value of investment securities, will likely coincide with severe economic
stress. In such a case, SVBFG may experience reduced cash flows and credit
availability and/or limited access to capital markets, which may increase its reliance
on higher cost funding sources.
• Interest Rate Risk. Interest rate risk is the risk of loss arising from potential adverse
changes in the value of SVBFG’s assets and liabilities resulting from changes in
interest rates. Interest rate exposure may affect the carrying value of SVBFG’s
assets that are subject to changes in fair market valuation. SVBFG’s net interest
income may also be negatively affected by interest rate repricing differences
between assets and liabilities.
• Operational Risk. Operational risk is the risk of loss resulting from inadequate or
failed internal processes or systems; human errors or misconduct; or external
events. Operational losses may result from, among other things, internal/external
fraud; information security breaches or cybersecurity-related incidents; failure to
meet professional obligations involving clients, products or business practices; and
business disruptions or systems failures.
2 This represents a change in assumptions compared to 2015, where SVBFG made a simplifying, yet conservative,
assumption by holding noninterest expense constant in the Supervisory Severely Adverse Scenario, compared to
“baseline” results.
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In addition, as part of the overall process for stress testing and setting internal capital
limits, SVBFG considers other risks, which are generally assessed on both a qualitative and a
quantitative basis:
• Model Risk. SVBFG utilizes models to quantify risks that are inherently difficult to
quantify, such as credit, market, liquidity, interest rate and operational risks. Model
risk is the risk of adverse consequences arising from decisions based on incorrect or
misused model outputs and reports. Model risk may result from flaws in model
design, use of inadequate or incomplete data within models, or incorrect or
inappropriate utilization of models.
• Legal/Compliance Risk. Legal/compliance risk is the risk of loss or increased costs
resulting from regulatory restrictions or requirements on SVBFG’s activities or the
conduct of its business. Legal/compliance risk also is the risk of loss arising from
violations of laws, rules, regulations or ethical standards, and includes exposure to
orders, fines, penalties, and punitive damages resulting from litigation or regulatory
actions.
• Strategic/Reputation/Country Risk. Strategic risk is the risk of loss that may arise
from adverse business decisions, poor implementation of business strategy or lack of
responsiveness to changes in the banking industry and operating environment.
Reputation risk is the risk to current or anticipated earnings, capital or enterprise
value arising from negative public opinion. Country risk is the risk that a sovereign
event or action alters the value or terms of contractual obligations of obligors,
counterparties and issuers or adversely affects markets related to a particular
country.
III. Stress Test Methodology
The Finance Committee of the Company’s Board of Directors oversees the overall stress
testing process at the Board level. The Company’s Asset Liability Committee (“ALCO”) oversees
the stress testing process at the management level. Senior management is directly responsible
for developing, implementing and monitoring the actual stress testing process. The stress
testing process is formally managed by a working group consisting of representatives from the
Company’s Credit, Risk Management, Finance, and Compliance functions. Internal Audit also
participates in the process, as appropriate. The working group meets regularly throughout the
process to ensure that assumptions, loss estimates, and controls are appropriately reviewed
and assessed before being elevated to the Company’s ALCO. In turn, ALCO reviews and
challenges the preliminary stress test results before final presentation to the Finance
Committee of the Company’s Board of Directors.
The Company’s stress testing framework utilizes both quantitative and qualitative
estimation methodologies, as appropriate, to project capital levels through the 9Q Planning
Horizon. Quantitative methodologies are based on statistical models (mainly regression-based
analyses of time series data) developed by management, and qualitative methodologies are
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largely based on management’s subjective business judgment. In addition, macroeconomic
variables associated with applied scenarios are incorporated into models where applicable.
In particular, specific methodologies for estimating and modeling the key projections
under the Supervisory Severely Adverse Scenario are discussed below:
• Pre-Provision Net Revenue (“PPNR”). PPNR consists of: (i) net interest income and
noninterest income; less (ii) noninterest expense. PPNR projections are based on
projections of loan and deposit volumes, noninterest income and noninterest
expense, as follows:
o Loans and Deposits. SVBFG projected loan and deposit volumes using
regression-based analyses of time series data associated with the
macroeconomic variables provided under the Supervisory Severely Adverse
Scenario.
o Net Interest Income. SVBFG utilized its asset liability management model to
project periodic changes in the balance sheet, interest income and interest
expenses related to the changes in volumes and interest rates contemplated by
the macroeconomic variables provided under the Supervisory Severely Adverse
Scenario.
o Noninterest Income and Noninterest Expense. SVBFG also projected noninterest
income and noninterest expenses using econometric models.
• Operational Risk Losses. SVBFG applied an operational risk quantification model to
establish its risk profile for purposes of estimating its operational losses in a stressed
economic environment. SVBFG’s operational risks are characterized by
high-frequency, low-severity losses, as well as the potential for extreme, yet
lower-probability, losses. For purposes of modeling an appropriate severity of
operational losses, SVBFG applied commonly used statistical distributions to assess
an appropriate number of operational failures consistent with the Supervisory
Severely Adverse Scenario.
• Loan Losses. SVBFG applied historical loan portfolio data, which included two
significant economic downturns, to estimate changes in key credit model inputs
based on macroeconomic variables provided under the Supervisory Severely
Adverse Scenario. SVBFG used a bottoms-up loss estimation approach to generate
projections of changes in the probability of default, loss given default rates and
credit quality migration of borrowers in the loan portfolio. SVBFG employed key
variables related to credit quality behavior to estimate changes in loan losses.
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IV. SVBFG Cumulative Stress Test Results under the Supervisory Severely Adverse
Scenario
SVBFG’s cumulative stress test results under the Supervisory Severely Adverse Scenario
for the 9Q Planning Horizon are presented below.
A. Estimates of Aggregate Losses, Pre-Provision Net Revenues, Loan Loss Provisions
and Net Income
Table 1 below shows the cumulative estimates of SVBFG’s projected aggregate losses,
PPNR and loan loss provisions resulting in changes in net income before taxes through the 9Q
Planning Horizon. Aggregate losses consist primarily of provision for loan losses, and to a much
lesser extent, operational risk losses and losses associated with non-marketable securities and
equity warrant assets. Non-marketable securities and warrant losses are included in
noninterest income, and operational risk losses are included in noninterest expense, as set
forth in Table 1 below.
Table 1. Projected Losses, Revenue and Net Income Before Taxes (1Q2016 through 1Q2018)
Supervisory Severely Adverse Scenario
9-Qtr Total
($ in Millions)
Net interest Income $ 2,062.6
plus Noninterest income 382.7
less Noninterest expense* (1,388.1)
Pre-Provision net revenue 1,057.2
plus Other revenues 0
less Provision for loan losses (1,457.3)
+/- Realized gains/(losses) on Held-to Maturity
(HTM)/Available-for-Sale (AFS) securities**
337.9
Net income (loss) before taxes $ (62.2)
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*
Noninterest expense includes losses related to operational risks and expenses related to staffing, legal, compliance,
occupancy and professional services.
** Realized gains were comprised entirely from AFS securities.
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Table 2 below provides details on cumulative estimates of loan losses based on the
Federal Reserve’s reporting templates:
Table 2. Projected Loan Losses by Type of Loans (1Q2016 through 1Q2018)
Supervisory Severely Adverse Scenario
9-Qtr Losses
($ in Millions)
Cumulative Loss
Rate (in %)+
First lien mortgages, domestic $ 14.8 0.93%
Commercial and industrial 835.3 8.31%
Other construction loans 5.9 4.80%
Multifamily loans 0.5 6.54%
Non-farm, non-residential other loans 14.5 18.68%
Other consumer loans 5.2 10.02%
Other loans 2.7 0.05%
Total loan losses $ 878.9 4.88%
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+ Cumulative loss rates (by loan type) are calculated based on the credit quality migration and default rate projections in each
category relative to average quarterly loan volume throughout the 9Q Planning Horizon
B. Estimates of Pro Forma Capital Ratios
Capital Action Assumptions for SVBFG and the Bank
The DFAST rules require SVBFG to take into account its actual capital actions as of the
end of the first quarter of the 9Q Planning Horizon (the end of the first quarter of 2016). For
the second through ninth quarters of the 9Q Planning Horizon (second quarter of 2016 through
first quarter of 2018), the DFAST rules require SVBFG to make certain capital action
assumptions in its capital ratios relating to common stock dividends, payments on certain
eligible instruments, redemptions or repurchases of certain eligible capital instruments and
issuances of common stock or preferred stock (excluding issuances related to expensed
employee compensation).
Specifically, based on such requirements, for the second through ninth quarters of the
9Q Planning Horizon, SVBFG and the Bank assumed the following:
• No dividends paid on SVBFG’s common stock;
• No authorized share repurchases;
• No issuances of common stock or preferred stock, except for those related to
employee compensation plans; and
• $7.88 million in cumulative distribution payments relating to outstanding trust
preferred securities.3
3 Amounts assumed to be declared and payable quarterly on $50 million of 7.00% Junior Subordinated Debentures,
issued in connection with the issuance of certain 7% Cumulative Trust Preferred Securities. These notes qualify as
Tier 1 Capital, but not Common Equity Tier 1 Capital; therefore, the impact is only applicable to the Tier 1 and
Total Risk-Based Capital Ratios and the Tier 1 Leverage Ratio.
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Under the DFAST rules, these capital action assumptions are applicable only to SVBFG,
but are not applicable to the Bank.
Projected Capital Ratios
Table 3 below sets forth SVBFG’s actual regulatory capital ratios and projected
regulatory capital ratios under the Supervisory Severely Adverse Scenario:
Table 3. SVBFG Actual 4Q2015 and Stressed Capital Ratios through 1Q2018^
Regulatory Capital Ratio Actual 4Q2015 Projected 1Q2018 Minimum Projected^^
Common Equity Tier 1 12.28 % 11.66 % 11.56 %
Tier 1 Risk-Based Capital 12.83 % 12.04 % 12.02 %
Total Risk-Based Capital 13.84 % 13.29 % 13.29 %
Tier 1 Leverage 7.63 % 10.02 % 7.63 %
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^ All projected capital ratios are calculated based on capital action assumptions provided under the DFAST rules. These
projections represent hypothetical estimates that involve an economic outcome that is more adverse than management
expectations. These estimates are not management’s forecasts of expected losses, revenues, net income before taxes, or
capital ratios.
^^ The minimum capital ratios presented are the lowest results for any quarter over the 9Q Planning Horizon or, in the case of
the Tier 1 Leverage ratio, the actual ratio as of December 31, 2015.
Table 4 below sets forth the Bank’s actual regulatory capital ratios and projected
regulatory capital ratios under the Supervisory Severely Adverse Scenario:
Table 4. Bank Actual 4Q2015 and Stressed Capital Ratios through 1Q2018^
Regulatory Capital Ratio Actual 4Q2015 Projected 1Q2018 Minimum Projected^^
Common Equity Tier 1 12.52 % 12.72 % 11.65 %
Tier 1 Risk-Based Capital 12.52 % 12.72 % 11.65 %
Total Risk-Based Capital 13.60 % 13.97 % 12.94 %
Tier 1 Leverage 7.09 % 10.26 % 7.09 %
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^ All projected capital ratios are calculated based on capital action assumptions provided under the DFAST rules. These
projections represent hypothetical estimates that involve an economic outcome that is more adverse than management
expectations. These estimates are not management’s forecasts of expected losses, revenues, net income before taxes, or
capital ratios.
^^ The minimum capital ratios presented are the lowest results for any quarter over the 9Q Planning Horizon or, in the case of
the Tier 1 Leverage ratio, the actual ratio as of December 31, 2015.
For both SVBFG and the Bank, the stressed minimum and first quarter 2018 capital
ratios remained above “well-capitalized” regulatory minimum levels and above the Company’s
internally established capital management policy minimums.
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V. Key Drivers of Changes to Capital Ratios
Changes to SVBFG’s capital ratios under the Supervisory Severely Adverse Scenario are
driven primarily by credit losses and decreases in PPNR (including non-marketable securities
losses, warrant losses and operational risk losses). Changes in risk-weighted assets, driven
primarily by loan volumes and the persistent low level of interest rates (including negative
interest rates), also contributed significantly to changes in SVBFG’s capital ratios.
Substantially all of SVBFG’s total consolidated risk-weighted assets are held at the Bank,
SVBFG’s primary operating subsidiary.4 Changes in risk-weighted assets are the primary driver
of changes in the capital ratios. Additionally, most of SVBFG’s total consolidated equity capital
is held at the Bank.5 With the exception of losses on non-marketable securities and warrants,
which are held at the parent company level and thus only impact SVBFG, the key drivers of
changes to the Bank’s capital ratios are generally the same as those at the consolidated SVBFG
parent company level because the Bank is consolidated into SVBFG for regulatory capital
purposes.
Credit Losses. Under the Supervisory Severely Adverse Scenario, declining economic
conditions result in an increase in nonperforming loans, which drives up credit loss rates.
SVBFG’s Commercial and Industrial (“C&I”) loans contribute the largest nominal impact on
capital with $835.3 million in cumulative losses over the 9Q Planning Horizon. Similarly, losses
from C&I loans also produce among the highest default rates (8.31%, based on average
quarterly balances) across SVBFG’s loan categories under the Supervisory Severely Adverse
Scenario. In aggregate, credit losses flow directly through retained earnings (a component of
equity) and create the largest negative impact on SVBFG’s capital ratios.
Pre-Provision Net Revenues. The decrease in PPNR is significant under the Supervisory
Severely Adverse Scenario. Net interest income and noninterest income totaling $2,445.3
million is more than offset by $1,388.1 million in noninterest expenses6 and $1,457.3 million in
provision. The result is a net negative impact on capital of ($400.1) million coming from PPNR
and provision during the 9Q Planning Horizon. Specifically, negative impacts on PPNR and
provision include lower net interest income driven primarily by lower interest income from
decreasing interest rates under the Supervisory Severely Adverse Scenario. Interest rates
decline dramatically and actually fall below 0% at times during the 9Q Planning Horizon
resulting in further margin compression on earning assets and, ultimately, lower net interest
income. Partially offsetting this decrease is $337.9 million of realized gains from sales of
available-for-sale securities. Other negative adjustments to PPNR include lower returns on
non-marketable securities and equity warrants. The Dow Jones Equity Market Index declines
nearly 51% during the first four quarters of the 9Q Planning Horizon under the Supervisory
Severely Adverse Scenario. The result is a material negative impact on the market value of
4 As of December 31, 2015, 94% of SVBFG’s total consolidated risk-weighted assets were held at the Bank level.
5 As of December 31, 2015, 96% of SVBFG’s total consolidated equity capital was held at the Bank level.
6 Noninterest expenses include losses related to operational risks and expenses related to staffing, legal,
compliance, occupancy and professional services.
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these non-marketable securities and warrants assets. Because non-marketable securities and
warrants assets are held only at the parent level, non-marketable investment losses and
warrant losses are reflected in SVBFG’s noninterest income but are not reflected in the results
for the Bank.
Risk-Weighted Assets. A significant portion of SVBFG’s balance sheet consists of a
fixed-income investment portfolio of high-quality U.S. Treasury notes and securities issued and
backed by government sponsored enterprises (e.g., the Federal Home Loan Banks, the Federal
National Mortgage Association and the Federal Home Loan Mortgage Corporation). Due to its
high-quality nature, SVBFG’s fixed-income investment portfolio contributes only a small amount
to total regulatory risk-weighted assets.7 Therefore, although the vast majority of the
Company’s balance sheet is considered low-risk under the capital rules, the Company’s capital
ratios are particularly sensitive to changes in the volume of its loan portfolio, which includes
both loans and unfunded lending commitments. Under the Supervisory Severely Adverse
Scenario, loan volumes are projected to decline given the severe impact on the economy and
increase in credit losses. Lower loan volume reduces regulatory risk-weighted assets, which has
a net positive impact on the Company’s risk-based capital ratios. A reduction in total
risk-weighted assets offsets, to a limited extent, the negative impact on regulatory capital from
credit losses and decreases in PPNR.
The following charts represent the impact of each of the material drivers of changes in
Common Equity Tier 1 and Tier 1 Leverage ratios8 for SVBFG under the Supervisory Severely
Adverse Scenario. Ratio changes at the Bank level were similarly impacted from credit losses,
operational risk and changes in risk-weighted assets (“RWA”) but, as previously noted, Bank
results are not impacted by losses from non-marketable securities or warrants:
7 Additionally, because the high-quality fixed-income investment portfolio consists primarily of U.S. Treasury notes
and securities issued and backed by Government Sponsored Enterprises, the Company does not believe
modeling credit losses or other negative impacts from Other-than-Temporary Impairment is appropriate.
8 No charts for Total Capital or Tier 1 Capital are included, because both categories are primarily comprised of
Common Equity Tier 1 Capital; hence, the impact of changes to Common Equity Tier 1 Capital is largely
consistent with Total Capital and Tier 1 Capital.
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VI. Conclusion
The results of SVBFG’s stress test over the 9Q Planning Horizon under the Supervisory
Severely Adverse Scenario showed significant impacts on capital that are attributable to credit
risk, market/liquidity risk and interest rate risk. The Company’s capital ratios were further
stressed by the balance sheet growth even under the Supervisory Severely Adverse scenario.
Throughout the 9Q Planning Horizon under such scenario, regulatory capital ratios for both
SVBFG and the Bank remained above the “well-capitalized” regulatory minimums as well as
above the internally established capital management policy minimums.
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VII. Forward-Looking Statements Disclaimer
This disclosure contains forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements are subject to known and
unknown risks and uncertainties, many of which may be beyond SVBFG’s control.
Forward-looking statements are statements that are not historical facts, such as forecasts of
SVBFG’s future financial results and condition, expectations for SVBFG’s operations and
business, and SVBFG’s underlying assumptions of such forecasts and expectations. In addition,
forward-looking statements generally can be identified by the use of such words as
“becoming,” “may,” “will,” “should,” “could,” “would,” “predict,” “potential,” “continue,”
“anticipate,” “believe,” “estimate,” “seek,” “expect,” “plan,” “intend,” the negative of such
words or comparable terminology. In this disclosure, SVBFG makes forward-looking statements
discussing management’s expectations under hypothetical scenarios about, among other
things, economic conditions; opportunities in the market; the outlook on SVBFG’s clients'
performance; SVBFG’s financial, credit, and business performance, including potential
investment gains/losses; loan growth, loan mix and loan yields; expense levels; and financial
results (and the components of such results) for the 9Q Planning Horizon, which spans the
period between the first quarter of 2016 through the first quarter of 2018.
Although SVBFG believes that the expectations reflected in SVBFG’s forward-looking
statements are reasonable, SVBFG has based these expectations on its current beliefs as well as
its assumptions, and such expectations may not prove to be correct. Because forward-looking
statements relate to the future, they are subject to inherent uncertainties, risks and changes in
circumstances that are difficult to predict and many of which are outside SVBFG’s control.
SVBFG’s actual results of operations and financial performance could differ significantly from
those expressed in or implied by SVBFG’s management’s forward-looking statements.
Important factors that could cause SVBFG’s actual results and financial condition to differ from
the expectations stated in the forward-looking statements include, among others: (i)
deterioration, weaker than expected improvement, or other changes in the state of the
economy or the markets in which SVBFG conducts business or are served by SVBFG (including
the levels of IPOs and M&A activities); (ii) changes in the volume and credit quality of SVBFG’s
loans; (iii) the impact of changes in interest rates or market levels or factors affecting or
affected by them, especially on SVBFG’s loan and fixed-income investment portfolios; (iv)
changes in SVBFG’s deposit levels; (v) changes in the performance or equity valuations of funds
or companies in which SVBFG has invested or holds derivative instruments or equity warrant
assets; (vi) variations from SVBFG’s expectations as to factors impacting SVBFG’s cost structure;
(vii) changes in SVBFG’s assessment of the creditworthiness or liquidity of SVBFG’s clients or
unanticipated effects of credit concentration risks which create or exacerbate deterioration of
such creditworthiness or liquidity; (viii) accounting changes, as required by GAAP; and (ix)
regulatory or legal changes or their impact on SVBFG, including the impact of the Volcker Rule.
For additional information about these and other factors, please refer to SVBFG’s public reports
filed with the U.S. Securities and Exchange Commission, including under the caption “Risk
Factors” in SVBFG’s most recent Annual Report filed on Form 10-K. The forward-looking
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statements included in this disclosure are made only as of the date of this disclosure. SVBFG
does not intend, and undertakes no obligation, to update these forward-looking statements.
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