HSBC Acquires Silicon Valley Bank’s British Subsidiary


HSBC Bank Acquires Silicon Valley Bank UK Subsidiary for One Pound

HSBC Bank has acquired the British subsidiary of Silicon Valley Bank (SVB) for the symbolic figure of one pound after its collapse last week. The private rescue was facilitated by the UK Government and the Bank of England. This “private sale” was executed without UK taxpayers having to assume the bailout, according to the British Minister of Economy, Jeremy Hunt. Banking services are ensured, and deposits will be protected, the government said.

HSBC, the largest bank in Europe that mainly operates in the Asian market, estimated the tangible capital of the British subsidiary of SVB at about 1,400 million pounds. Customers and businesses holding deposits with the SVB UK will be able to access them as normal.

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The Bank of England said that “this measure was taken to stabilize SVBUK, ensuring the continuity of banking services, minimizing disruption to the UK technology sector, and supporting confidence in the financial system.” The Bank of England also confirmed that the money of everyone who has deposits in the SVBUK is protected as a result of this transaction.

The SVB, based in California, announced last Wednesday that it was going to seek a capital increase to face its financial difficulties, which had led it to get rid of investments worth some 21,000 million dollars. The announcement prompted many clients to withdraw their funds, after which regulators had to close the bank on Friday due to lack of liquidity.

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