Seven ASX technology companies having cash deposits with Silicon Valley Bank

Highlights:

• On 10 March 2023, California-based Silicon Valley Bank was closed by the California Department of Financial Protection & Innovation.
• Some of the ASX-listed tech companies are also customers of the now-defunct bank and are likely to be affected by this development.
• Here are seven ASX-listed tech companies having cash deposits with Silicon Valley Bank.

The California-based Silicon Valley Bank (SVB) drew its curtain on Friday, 10 March this year. Its shutters were pulled down by the California Department of Financial Protection & Innovation. As many start-ups and tech companies were the client of SVB, some of the ASX-listed tech companies are also customers of the now-defunct bank and are likely to be affected by this development.

Following the news, tech shares extended Friday's selloff, and the S&P/ASX 200 Information Technology index ended 1.32% lower, while the S&P/ASX 200 index declined 0.50%.

Here are seven ASX technology companies exposed to Silicon Valley Bank.

Sezzle Inc (ASX:SZL)

Minneapolis-located fintech company Sezzle Inc updated on Monday that as of 10 March, the company had a cash balance of US$68 million and out of that, US$1.2 million was held at Silicon Valley Bank, representing less than 2% of Sezzle’s total cash balance.

Out of the US$1.2 million, US$0.25 million is insured by FDIC. Hence, the fund at risk is US$1 million. Recovery of this uninsured amount will depend on what FDIC decides.

The stock closed Monday at AU$0.53, declining 5.357%.

Siteminder Limited (ASX:SDR)

Shares of the technology company that offers hotel booking services, fell 4.761% to close at AU$3.6 on Monday.

The company today said it took action to lessen its financial exposure to Silicon Valley Bank and to Silicon Valley Bank UK on 10 March. It had successfully transferred a part of its cash holdings to other banking partners.

However, as of 12 March, the company still had cash holdings of around AU$10 million to Silicon Valley Bank and to Silicon Valley Bank UK. It also has an undrawn facility of US$20 million revolving credit facility with Silicon Valley Bank.

By the end of December last year, the company had AU$68.2 million as a cash balance.

Redbubble Limited (ASX:RBL)

The company said it has around AU$1.7 million deposited with Silicon Valley Bank. Post considering FDIC insurance, which is to the tune of US$0.25 million, the company values its cash exposure to SVB at around AU$1.3 million.

By the end of Monday, the stock slipped 3.703% at AU$0.52.

Bigtincan Holdings Limited (ASX:BTH)

Provider of enterprise mobility software, Bigtincan Holdings Limited updated on Monday that it primarily banks with National Bank in Australia and Citizens Bank in the USA. It further updated that it has no material exposure to FDIC action’s outcome.  

The stock ended 1.086% lower at AU$0.455 on Monday.

Life360 Inc. (ASX:360)

The California-domiciled IT company, which offers location-based services, updated on Monday that it had an exposure of around US$95.1 million to the bank, comprising US$6.1 million in deposits and US$75.4 million in shares of money market mutual funds handled by Morgan Stanley, Western Asset and Blackrock. 360 anticipates FDIC should liquidate the funds and distribute the amount or make it available to it (contingent on FDIC confirmation of consumer ownership) in the near term. But this is yet to be confirmed.

On Monday, the stock slipped 0.396% to AU$5.03 by the end of the market session.

Xero Limited (ASX:XRO)

Shares of online accounting software provider Xero Limited closed 0.392% lower at AU$86.39 on Monday. 

On the same day, the company updated that it did not have any material exposure to Silicon Valley Bank. As of 10 March, its total exposure to Silicon Valley Bank was around US$5 million, which is not even 1% of the company’s cash balance (as of 30 September last year).

Nitro Software Limited (ASX:NTO)

The document productivity software company Nitro Software Limited on Monday notified that around US$12.18 million of the company’s international cash reserves are held in deposit at Silicon Valley Bank. Further, it said that SVB's collapse has not affected Potentia’s takeover offer.

The stock ended Monday at AU$2.19, increasing 0.458%