Silicon Valley Bank (SVB) reportedly collapsed on Friday amid a financial crisis.
The SVB was recorded to be the the second-largest bank in US history and the largest collapse since the time when the Washington Mutual Bank was put into receivership by federal regulators in 2008.
In the report published by the United Vouce, it was revealed that days prior to the collapse of the SVB, “the federal government took over Signature Bank — which became the third-largest bank collapse in history. The news of the two banks failing threw the markets into a panic that spread across the Atlantic Ocean.”
“When SVB collapsed in the US on Friday, HSBC UK executives jumped into action. The financial institution purchased SVB UK for a symbolic £1. The deal came after a week of negotiations between the banking industry and the UK government as authorities desperately tried to prevent a larger financial crisis from unfolding,” the report added.
In addition, a separate report was also released by The Guardian, reporting that multiple lawmakers, banking regulators and executives have worked together in response to the controversial SVB’s collapse in an attempt to prevent a larger crash in the UK.
This morning, the Government and the Bank of England facilitated a private sale of Silicon Valley Bank UK to HSBC
Deposits will be protected, with no taxpayer support
I said yesterday that we would look after our tech sector, and we have worked urgently to deliver that promise— Jeremy Hunt (@Jeremy_Hunt) March 13, 2023
“It was frantic,” an anonymous person said during an interview with the media outlet. The person also claimed that they knew they could solve the problem but they were only given a deadline until 7 a.m. on Monday to do it to prevent a stock market collapse.
According to TechCrunch, the SVB’s collapse has caused the UK tech industry to be highly exposed.
The bank also explained that “SVB UK had loans of around £5.5 billion and deposits of around £6.7 billion.”
Amid the controversy, UK Chancellor Jeremy Hunt released a statement about the deal and reassured the public that their money is safe.
“This morning, the Government and the Bank of England facilitated a private sale of Silicon Valley Bank UK to HSBC. Deposits will be protected, with no taxpayer support. I said yesterday that we would look after our tech sector, and we have worked urgently to deliver that promise.” Hunt said in the statement.
