HSBC UK Bank Plc has acquired the UK division of the collapsed Silicon Valley Bank (SVB) for £1, a move that will protect depositors’ interests in the failed bank.
The acquisition was funded by HSBC’s existing resources and will ensure that customers and businesses with deposits in SVB UK can access their funds and banking services as usual.
The sale to HSBC was facilitated by the UK government to stabilize SVB UK, with the Bank of England confirming that all depositors’ money is safe.
The deal will also minimize disruption to the UK technology sector and support confidence in the financial system.
The acquisition of the UK arm of SVB has brought relief to tech companies in the UK, who were concerned about losing their funds at the collapsed bank, which would have had an existential impact on their businesses.
However, calls for the protection of depositors in the SVB U.S. continue, particularly among tech startups.
The Federal Reserve has also issued a statement assuring depositors in the SVB U.S. that they will receive help to fully protect all deposits, both insured and uninsured.
Depositors will have access to their money from Monday, March 13, and no losses associated with the resolution of SVB will be borne by taxpayers.
Treasury Secretary Janet Yellen approved actions to enable the FDIC to complete its resolution of SVB in a manner that fully protects all depositors, while the Federal Reserve is prepared to address any liquidity pressures that may arise.
