June 6, 2023

The fate of a mobile gaming company in India shows the bank’s global reach as regulators move to limit the fallout from the collapse of a Silicon Valley bank.

Shares of Nazara Technologies fell 6.5% on Monday after the company said two of its subsidiaries had accounts with Silicon Valley Bank, which collapsed on Friday. The combined balances of the two units at the failed bank exceed $7.7 million.

Indian officials, like those elsewhere in the world, have tried to reassure investors about any possible impact on the country’s banking sector. They also said they would meet with representatives of the Indian start-up community in the coming days to understand the implications for them.

For Nazara, “the situation at SVB remains fluid,” it said in a statement, but stressed that the operations of its subsidiaries were not affected by the failure of Bank of America. The company, whose portfolio includes games based on the mythical Chhota Bheem character from the popular children’s cartoon, said it had enough money. The stock recovered most of its losses in Mumbai by late afternoon.

The U.S. regulatory response has also eased concerns among some of the bank’s investors and clients. One such client is Ruchit Garg, who runs Harvesting Farmer Network, an agricultural technology platform that has deposits with Silicon Valley Bank. Mr Garg said he was relieved his company’s deposits were backed by US regulators.

Mr Garg said that apart from some start-ups, the bank’s collapse was unlikely to have a serious impact on the Indian economy. The local stock market could take a hit for a while, he said, adding, “It’s nerve-wracking, and the market is sentiment.”

India’s main stock benchmarks, the Sensex and the Nifty 50, were both down more than 1.5% on Monday afternoon.

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