Bank for 1 pound: HSBC bought the British “subsidiary” of Silicon Valley Bank

On Monday, one of the largest European banks, the British HSBC, bought for 1 pound the local “daughter” of Silicon Valley Bank, which collapsed a few days earlier.

It is reported Financial Times.

HSBC overnight became the leading bidder for SVB UK, paying a symbolic £1 for the bank.

Chief executive Noel Quinn was involved in talks with British Prime Minister Rishi Sunak, who is currently in the US for defense talks.

British Chancellor of the Exchequer Jeremy Hunt wanted the failed bank to be sold because it would avoid a major intervention by the British government to protect depositors.

“This morning the Government and the Bank of England facilitated the private sale of Silicon Valley bank HSBC. Deposits will be protected, at no cost to taxpayers,” Hunt wrote on Twitter.

The Bank of England, which has warned it plans to declare the UK bank insolvent following the collapse of its parent company, said measures had been taken “to stabilize SVB UK, ensure continuity of banking services, minimize disruption to Britain’s technology sector and maintain confidence in the financial system”.

Interlocutors of the agency note that the sale of the bank was a “completely competitive” process, in which several parties interested in taking over the bank participated. Among the contenders were OakNorth and Bank of London.

SVB UK has 3,300 UK clients, including start-ups, venture capital firms and foundations. Many have deposits of less than £85,000 covered by the Financial Guarantee Scheme. In total, the bank has 6.7 billion pounds of deposits and 5.5 billion pounds of loans.

Read more: The world is panicking over the collapse of Silicon Valley Bank and fears a new financial crisis. Is everything so serious?

We remind you:

The Federal Deposit Insurance Corporation and the Federal Reserve are considering the possibility creation of a fund, which would have allowed regulators to keep more deposits in troubled banks after the collapse of Silicon Valley Bank.

Silicon Valley Bank pond the largest U.S. bankruptcy in a decade, after its longtime customer base of tech startups became concerned and began withdrawing deposits.