The British government on Monday said it had facilitated a private sale of the United Kingdom arm of the collapsed Silicon Valley Bank to HSBC Holdings Plc's 'ring-fenced subsidiary' - with help from the Bank of England - for 1 pound sterling, or around ₹99. This acquisition makes excellent strategic sense for our business in the UK," HSBC CEO Noel Quinn said, adding, "SVB UK customers can continue to bank as usual, safe in the knowledge that their deposits are backed by the strength, safety and security of HSBC."I am pleased we have reached a resolution in such short order. HSBC is Europe's largest bank, and SVB UK customers should feel reassured by the strength, safety and security that (it) brings them," UK finance minister Jeremy Hunt said. BoE officials told Reuters separately that the wider banking system in the United Kingdom remains safe, sound, and well-capitalised.
The dramatic collapse of the SVB Financial Group - which focuses on tech start-ups - on Friday was the biggest in the United States since the 2008 crisis and threatened a significant impact on tech companies operating in the UK; over 250 of these had said SVB's failure posed an 'existential threat' Among other contenders for the takeover was an investment firm controlled by a high-ranking member of the Abu Dhabi royal family, Bloomberg reported earlier Sunday.Also mooted was a plan for other lenders to take on the British depositors; this would involve big banks offering them access to money until their own funds are released by SVB.The announcement comes after US financial regulators moved on Sunday to assure all depositors their money is safe following the collapse of Silicon Valley Bank and set up a new lending program offered by the Federal Reserve with funds from the Treasury Department.