The UK arm of failed US lender Silicon Valley Bank has been bought by HSBC for a nominal £1 ($1.2) in a rescue deal, the government and HSBC announced Monday.
The sale, overseen by the Bank of England and the Treasury, comes after SVB collapsed Friday sparking panic in Britain over its key customers in the technology and life science sectors.
‘Silicon Valley Bank (UK) Ltd has today been sold to HSBC,’ the government said in a statement, after frantic talks reportedly led by prime minister Rishi Sunak.
‘This transaction has been facilitated by the Bank of England, in consultation with the Treasury.’
Finance minister Jeremy Hunt added that no government cash was involved, while all customer deposits have been safeguarded.
‘This (deal) ensures customer deposits are protected and can bank as normal, with no taxpayer support,’ added Hunt.
‘I am pleased we have reached a resolution in such short order.’
Hunt had warned Sunday that there was a ‘serious’ risk to Britain’s tech and life sciences firms that banked with SVB.
HSBC agreed to pay just £1 for the business, the bank giant added in a separate statement on Monday.
The Asia-focused lender added that SVB UK had loans of about £5.5 billion and deposits of around £6.7 billion.
‘This acquisition makes excellent strategic sense for our business in the UK,’ said HSBC chief executive Noel Quinn.
‘It strengthens our commercial banking franchise and enhances our ability to serve innovative and fast-growing firms, including in the technology and life-science sectors, in the UK and internationally.’
This NEWS originally published in Dhaka based News Paper The New Age.
