The California bank’s operations and liquidity remain healthy, Shanghai Pudong Development said in a note to clients that was seen by Bloomberg News. The Shanghai- based bank and the joint-venture company didn’t immediately respond to requests for comment.

SVB’s troubles are raising concerns in China because the joint venture has been aggressively lending to startups and funds that can’t borrow from traditional banks, according to people familiar with the matter. Silicon Valley Bank set up SPD Silicon Valley Bank Co. in 2012, and offers several banking products and services in China, including working capital and trade finance, according to its website. 

Concerns that SVB faces a liquidity crunch have rippled across markets after prominent venture capital firms recommended companies withdraw money from the bank. SVB was halted in New York trading Friday after plunging another 69% premarket.

The Chinese firm said SVB’s problems started from the sale of its available-for-sale securities. The substantial sale was meant to rotate to assets with higher yield and boost profitability, however it resulted in a loss that largely damped Wall Street’s expectations for first-quarter earnings, according to the note.

Several venture funds focusing on China have reached out to their portfolio companies to gauge how much exposure they have to SVB, according to the people, who asked not to be identified discussing a private matter. 

The Santa Clara, California-based SVB Financial Group said it’s issuing $2.25 billion of shares to bolster its capital position after a significant loss on its investment portfolio. Bonds posted record declines, igniting a broad selloff in US bank shares that also spread to Asia and Europe.

Shanghai Pudong dropped 1.7% in China trading, the biggest decline since October.