The embattled Silicon Valley Bank has just come under new ownership, at least in the United Kingdom.

Per a filing on March 13, 2023, HSBC UK Bank plc, a subsidiary of the behemoth bank, announced that it is purchasing Silicon Valley Bank UK Limited (SVB UK) for £1 (or $1.21 at today's exchange rate).

The acquisition also means that depositors at the British branch of SVB "can continue to bank as usual, safe in the knowledge that their deposits are backed by the strength, safety, and security of HSBC," said CEO of HSBC Group Noel Quinn.

The UK finance ministry told Decrypt via email that "customers of SVB UK will be able to access their deposits and banking services as normal from today," while the UK's Chancellor of the Exchequer Jeremy Hunt tweeted that "deposits will be protected, with no taxpayer support."


Like its parent company in California, SVB UK's clients also included businesses in the tech and startup world. The branch held roughly $8.1 billion (£6.7 billion) in deposits and held loans of roughly $6.6 billion (£5.5 billion), per the filing.

In a statement provided to Decrypt by his office, Jeremy Hunt said that, "the UK’s tech sector is genuinely world-leading and of huge importance to the British economy, supporting hundreds of thousands of jobs. I said yesterday that we would look after our tech sector, and we have worked urgently to deliver on that promise and find a solution that will provide SVB UK’s customers with confidence."

What was Silicon Valley Bank?

Silicon Valley Bank went belly up last week following a liquidity crisis, due to a combination of rising interest rates and a bank run of sorts among its tech- and startup-centric clientele.


Given the attractive rates for rather conservative assets like Treasuries, SVB had been converting its dollars into Treasuries both long-term and short-term, Fresco Capital managing partner Stephen Forte told Decrypt.

But with the broader economy tightening, clients had also been steadily drawing from their deposits to give themselves a longer runway.

The simultaneous trend to withdraw as well as mismatched maturity dates, SVB was forced to sell their Treasuries at a loss to help shore up clients' interest to stock up on dollars.

Following an announcement that the bank was then mulling a stock sale, rumors spread that SVB was facing a serious liquidity crisis. Peter Thiel's Founder's Fund reportedly told portfolio companies that it should also pull their funds from the bank should it go under.

The bank was eventually shut down on Friday afternoon, with the FDIC taking over its operations. The firm's failure was the biggest since 2008.

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