Why SVB Financial Stock Soared 13% on Friday
Shares of SVB Financial (NASDAQ: SIVB) soared at market open and are trading higher by about 13% as of 1 p.m. EDT. The holding company for Silicon Valley Bank reported robust profit growth driven by rising rates, gains on its investment portfolio, and a swelling loan portfolio in the third quarter.
SVB Financial is arguably the bank stock for rising interest rates. That's because the company has a valuable deposit franchise that brings in billions of no-cost deposits. Approximately 82% of client deposits are non-interest-bearing, meaning that SVB Financial can lend and invest these funds without sharing the income with its depositors.
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Source: Fool.com
