The UK division of Silicon Valley Bank was purchased by HSBC.
On April 26, 2022, a sign is shown over an HSBC bank branch in the heart of London. The Asia-focused bank HSBC reported lower first-quarter profits on Tuesday after being hammered by bad debts as the cost of living increased due to Russia’s invasion of Ukraine.
The Silicon Valley Bank (SVB), which failed to generate enough money to cover losses from the sale of assets, collapsed on Friday, March 10.
Customers in the UK are concerned that SVB UK may potentially be impacted by this frightening failure.
However, the customers of SVB’s U.K. business were spared thanks to HSBC’s most recent acquisition.
Silicon Valley Bank UK Arm Acquired by HSBC for Only $2
The most recent story from BBC News indicates that HSBC UK has acquired SVB’s U.K. division.
On March 10, 2023, in Santa Clara, California, a client sits outside the headquarters of a closed Silicon Valley Bank (SVB). California regulators closed Silicon Valley Bank on Friday morning and handed control of the institution over to the Federal Deposit Insurance Corporation of the United States.
Even though SVB UK’s US parent firm failed, it was still profitable at the time HSBC announced the acquisition.
According to Bank of England sources, HSBC’s purchase of SVB UK was more of a preventative measure.
If HSBC didn’t make the transaction, SVB UK may also experience financial difficulties because the failure of SVP US might trigger a wave of withdrawals across the UK.
According to CNBC, SVB UK was only purchased for $1.21. Assets and liabilities, however, are not included in the acquisition.
According to Noel Quinn, CEO of HSBC Group, “SVB U.K. customers may continue to bank as normal, secure in the knowledge that their deposits are backed by the strength, safety, and security of HSBC.”
What’s in It for HSBC?
According to Noel Quinn, HSBC’s commercial banking brand may be strengthened by the most recent acquisition of SVB UK.
He continued by saying that they anticipate this acquisition will improve their ability to support innovative and quickly expanding businesses.
The UK’s technology and life sciences industries are among these.
Regulators in the UK stated that the newest acquisition of HSBC will not have any impact should financial problems arise.
They claimed that the 3,000 business customers of SVB UK could be readily handled by Europe’s biggest bank.
Here are some recent articles we published about the Silicon Valley Bank:
The failure of Silicon Valley Bank in the United States had an impact on a lot of Indian companies.
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