The British government and the British central bank facilitated the acquisition of the UK branch. Silicon Valley Bank (TYD) by the banking giant HSBC one pound in an operation by the finance ministerJeremy HuntHe said it was “strategic” for the future of the economy because it completely impacted the economy. technology sector. SVB’s UK subsidiary, although small with just over 3,000 commercial clients, is focused on start-ups and most of its operations deposit They belong to tech companies that Hunt describes as “fragile.”
“Some of them only had bank accounts with the SVB and so we were faced with a situation where we could see some of our most important companies, some of our most strategic companies disappear, and that would be extremely dangerous,” he said. However, he noted that “there has never been a systemic risk to our financial stability in the UK”.
American commercial banking SVB announced a capital increase last Wednesday facing financial difficulties. This announcement caused panic to spread. Customers’ withdrawals caused the bank to close on Friday lack of liquidity. The company’s listings on the stock market sank, affecting the banking industry worldwide.
In the United States, the decline of the SVB has become a threat. thousands of UK tech companies and investors They said their deposits and money are in British subsidiaries. If the affiliate went bankrupt, their deposits were frozen and could prevent them from paying staff or vendors.
Over the weekend, Hunt and Treasury officials important speeches with the industry and began an urgent search for a buyer. HSBC, Barclays, Bank of London and Oaknorth were candidates. The government has chosen HSBC, Europe’s largest bank operating predominantly in the Asian market, as the most stable and safest candidate. Hunt made it clear that this sale guarantees the protection of deposits and allows for normal banking transactions.
HSBC said in a statement, £1.4 billion The tangible capital of the SVB subsidiary. “This acquisition makes excellent strategic sense for our UK business as it strengthens our commercial banking franchise and improves our ability to serve fast-growing and innovative companies, including the technology and life sciences sectors,” said Noel Quinn, HSBC Chief Executive Officer. in and internationally”.
Sebastian Weidt, CEO of Universal Quantum, a 40-employee technology company all funded by SVB, told the BBC the last three days have been good. “incredibly stressful” He said the acquisition was a huge relief, and that if the deal weren’t reached, “it would have been very damaging for the entire industry”.