HSBC has agreed to buy Silicon Valley Bank’s U.K. arm following all-night talks led by Prime Minister Rishi Sunak and the Bank of England.
HSBC will pay a symbolic £1 (~$1.22) for SVB UK, preventing the U.K. government from having to step in to protect depositors. Before the sale, BOE planned to put SVB UK into insolvency.
The sale minimized disruption to the U.K. tech sector and saved hundreds of U.K. startups using the bank.
- HSBC CEO Noel Quinn said the acquisition made excellent strategic sense, with another executive referring to the deal as value accretive.
- SVB UK has about 3,000 U.K. clients, including startups, venture-backed companies, and funds.
- The bank had £6.7B ($8.2B) in deposits on Friday when the BoE deemed it at risk of failure.
- SVB UK experienced a run on its deposits similar to that of its U.S.-based parent company.
- On Thursday, the bank had more than £10B ($12.2B) in deposits.
