HSBC UK Bank plc is acquiring Silicon Valley Bank UK for £1.

The collapse of SVB in the US on Friday had led to fears that its UK arm, operated as a separate business, would also close.

They were realised as it entered insolvency on Sunday, with Chancellor Jeremy Hunt warning that the situation put the UK tech sector at “serious risk” in an interview with Sky.

Several tech-focused institutions expressed an interest in acquiring SVB UK, including a consortium of private equity firms led by Bank of London, Softbank-owned lender OakNorth Bank and Abu Dhabi investment vehicle ADQ.

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HSBC revealed news of the deal to the London Stock Exchange on Monday morning.

It said SVB UK, which recorded a profit before tax of £88 million last year, has loans of around £5.5 billion and deposits of around £6.7bn. All firms who banked with SVB UK will be able to access their funds.

The Bank of England said: “The Bank and HM Treasury can confirm that all depositors’ money with SVB UK is safe and secure as a result of this transaction. Silicon Valley Bank’s business will continue to be operated normally by SVB UK. All services will continue to operate as normal and customers should not notice any changes.”

HSBC stated: “The assets and liabilities of the parent companies of SVB UK are excluded from the transaction. The transaction completes immediately. The acquisition will be funded from existing resources.”

Noel Quinn, HSBC Group CEO, said: “This acquisition makes excellent strategic sense for our business in the UK. It strengthens our commercial banking franchise and enhances our ability to serve innovative and fast-growing firms, including in the technology and life-science sectors, in the UK and internationally.

“We welcome SVB UK’s customers to HSBC and look forward to helping them grow in the UK and around the world. SVB UK customers can continue to bank as usual, safe in the knowledge that their deposits are backed by the strength, safety and security of HSBC. 

“We warmly welcome SVB UK colleagues to HSBC, we are excited to start working with them.”

The government said that no taxpayer money was involved in the rescue deal.

“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,” said Chancellor Hunt.

“Today the government and the Bank of England have facilitated a private sale of Silicon Valley Bank UK; this ensures customer deposits are protected and can bank as normal, with no taxpayer support. I am pleased we have reached a resolution in such short order.

“HSBC is Europe’s largest bank, and SVB UK customers should feel reassured by the strength, safety and security that brings them.”

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