The British government and the Bank of England have agreed to a sale for Silicon Valley Bank UK, which will now be owned by HSBC. The Chancellor of the Exchequer Jeremy Hunt made sure that this private transaction happened without any money from taxpayers. So, whatever is deposited in the bank stays safe and secure.
HSBC Purchases Silicon Valley Bank UK for £1, Savings of Customers Stay Safe!
HSBC has bought the British part of Silicon Valley Bank from U.S. Government regulators who shut it down last week. The British government’s leader Jeremy Hunt said that savings of customers will stay safe and no money from taxpayers is being used for this purchase.
HSBC announced on Monday that it is buying Silicon Valley Bank UK Ltd. by paying £1 ($1.22) to its UK subsidiary HSBC-UK Bank plc. At the start of March, the bank had about £5.5bn worth of loans and deposits worth about £6.7bn, and earned a profit of £88m in the year ending December 22, 2022. The British subsidiary had around £1.4bn in tangible equity as well.
HSBC said that the deal has been finished as soon as it was announced. They also said that SVB UK’s parent companies won’t be included in the transaction and that the purchase will come from existing money.
Noel Quinn, CEO of HSBC Group, gave a comment on the situation.
This purchase is really good for our company in the U.K. It will make us better at helping fast-growing businesses, especially those involved with technology and health science, both in the U.K. and worldwide. Customers of SVB UK can keep using the same services as before but now they are part of HSBC and we look forward to working with them!
Officials in the U.S., like the Department of the Treasury, Board of Governors of Federal Reserve System and FDIC (Federal Deposit Insurance Corporation) promised on Sunday that anyone with money stored in Silicon Valley Bank will have access to all their money starting Monday, March 13. They also added that taxpayers won’t suffer any losses due to this decision.
Recently, HSBC bought Silicon Valley Bank UK for one British pound. Tell us what you think by posting in the comments below!