Chinese Government Grants Operating License to Silicon Valley Bank

With trumpets blaring, today's tech news focused on gossip about the late Steve Jobs, Netflix's jump off the equity value cliff, and who's zoomin' who at Yahoo, slipping quietly through the noise was by far the day's most important Silicon Valley story: the Chinese government granted Silicon Valley Bank a license to operate in the PRC.

This is a big deal. As reported in today's siliconvalley.com (the tech pages of the San Jose Mercury News), Silicon Valley Bank is the first foreign bank to be granted a license to operate inside China in nearly 15 years. Business in the country known as the Middle Kingdom is challenging enough with local connections, and virtually impossible without them. The official seal of approval probably means the bank will be a significant player in startup funding for Chinese tech firms. It also suggests the bank could serve as a useful bridge for backdoor communications between Chinese and US officials in this area of national security.

The bank is part of the SVB Financial Group, which is listed on NASDAQ with the call letters SVBI. Interestingly, according to records in Yahoo Finance, insiders have done some significant selling in the past few months. However, don't worry too much: the bank's major shareholders include some of finance's heaviest mutual fund hitters. They're not leaving SVBI anytime soon.