(London) The British branch of bankrupt Californian bank Silicon Valley Bank (SVB) has been sold to British banking giant HSBC for a symbolic pound, according to simultaneous statements from the British Treasury, the Bank of England and HSBC Monday.
The transaction, financed from HSBC’s “existing resources”, was orchestrated by the Bank of England, in coordination with the Treasury and UK banking and market regulators.
“SVB UK customers will be able to access their deposits and banking services as normal from today,” the Treasury said in its statement.
UK Finance Minister Jeremy Hunt said the deal was taking place “without taxpayer support”.
“HSBC is Europe’s biggest bank and SVB UK customers should take comfort in its strength,” he added.
The Minister was pleased to have “reached a solution in such a short time”, at the end of a weekend of meetings and negotiations, in particular with the technology sector while many companies in this sector were SVB customers and feared a sudden drying up of their cash flow.
Mr. Hunt had admitted this weekend a “serious risk” for this sector.
As of March 10, SVB UK held loans of around £5.5 billion and deposits of around £6.7 billion, according to HSBC, which says “the assets and liabilities of the houses mothers of SVB UK are excluded from the transaction”.
The American authorities for their part announced on Sunday a series of measures to reassure individuals and businesses about the solidity of the American banking system. In particular, they will guarantee the withdrawal of all deposits from the bankrupt SVB bank.
In addition to SVB, they will allow access to all the deposits of another establishment, Signature Bank, which was closed automatically by the regulator, to everyone’s surprise.
The Federal Reserve (Fed) – the US central bank – has also agreed to lend the necessary funds to other banks that need them to honor withdrawal requests from their customers.
The acquisition of SVB UK by HSBC “makes very good strategic sense for the UK. It strengthens our commercial banking and improves our ability to serve high growth and innovative companies, including in technology and biotechnology, in the UK and internationally,” said Noel Quinn, Chief Executive of HSBC. .
“The White Knights come to the rescue after a weekend of intense negotiations to avoid a contagion effect following the bankruptcy of SVB, which sent shock waves through the financial and technology sectors,” commented analyst Susannah Streeter. of Hargreaves Lansdown.
She also notes that the sale of SVB to HSBC removes a thorn from the side of Downing Street in the middle of the budget presentation week – scheduled for Wednesday.
“A tech bailout wouldn’t have looked very good when millions of people were told there wasn’t much money left to help them through a severe cost crisis. of life,” she added.
HSBC lost 2.97% to 575 pence Monday around 5 a.m. (Eastern time) on the London Stock Exchange, in a market down 1.68% 7618.43 points.