bankruptcy of Silicon Valley Bank (SVB) of USA is making its crunch felt globally. On the other side of the ocean, in the United Kingdomthe aftershocks continue.
HSBC to the rescue of the UK SVB
Thus, the Chinese capital bank bought the UK branch of the SVB at a “bargain” price. For as little as a pound sterling, HSBC got the private bailout of the financial institution of the United States.
In a statement sent to the Hong Kong Stock Exchangewhere HSBC is listed, estimates around 1.4 billion pounds (1.581 million dollars) the tangible capital of the British subsidiary of the SVB.
The move was facilitated by the UK government and the Bank of England and announced early this Monday. “It is carried out without British taxpayers having to assume any payment”, as specified by the British Minister of Economy, jeremy hunt.
insured deposits
“Deposits will be protected, without taxpayer support”Hunt said in a message posted on his Twitter account.
The bankruptcy of the Californian bank posed a threat to the British technology sector, given its importance for some of the firms in the tech and fintech sector in the United Kingdom.
After this operation, carried out with an immediate “shock” effect, the aim is to support the confidence of customers and companies with deposits in the British subsidiary will be able to access them normally, the British government has indicated.
In a parallel statement, the bank of england It has stated: “This measure was taken to stabilize SVBUK, ensuring the continuity of banking services, minimizing disruption to the UK technology sector and supporting confidence in the financial system.”
“The money of everyone who has deposits in the SVBUK is safe and secure as a result of this transaction,” the Bank of England statement concluded.
What will happen to the China headquarters of the SVB
In parallel, the joint venture of SVB in China, the SPD Silicon Valley Bank (SSVB) He assured that his balance sheet is independent from the Californian parent company and that his funds are insured.
He SSVB was founded in 2012 by the Californian bank together with the Chinese state bank Shanghai Pudong Development Bank. It was the first technology-focused bank in the country.
Although several Chinese firms have acknowledged that they had funds deposited with SVB’s parent company in the United Statesthe accounting independence of this Asian joint venture will allow the effect of bankruptcy to be less in the Asian giant.
Source: Ambito
I am a 24-year-old writer and journalist who has been working in the news industry for the past two years. I write primarily about market news, so if you’re looking for insights into what’s going on in the stock market or economic indicators, you’ve come to the right place. I also dabble in writing articles on lifestyle trends and pop culture news.
