New bank considers offer for UK arm of collapsed Silicon Valley Bank

- Advertisement -


The new bank, which has been in business for only two years, is reportedly considering a bid to buy the British branch of the failed Silicon Valley Bank (SVB).

The Bank of London (TBOL), whose head of finance Gavin Hewitt previously worked at SVB UK, has appointed an investment bank to advise on the bid, according to Sky News.

- Advertisement -

SVB imploded after depositors, who were concerned about the financial health of the lender, rushed to withdraw their deposits.

The frenetic two-day run at the bank blindsided observers and spooked markets, wiping out more than $100 billion in market value for US banks.

- Advertisement -

The collapse could have a significant impact on tech start-ups, according to a warning from the Coalition for a Digital Economy (Coadec).

The non-profit Campaigning for Policies to Support Digital Start-ups announced overnight to the Bank of England that it would apply to put SVBUK into the bank insolvency process.

Dom Hallas, Coadec’s executive director, said: “It’s clear this could have a significant impact on the UK’s tech start-up ecosystem.

“In light of the concern and panic, we wanted to share an update on what we know and where we are. We know there are a large number of start-ups and investors in the ecosystem who have significant investment in SVBUK and are Will be very worried.

“We have been engaging with the UK Government including the Treasury and Number 10 about the potential impact and I know that policy options are being worked out overnight.”

Mr Halas said currently information is limited but Coadec will update in the coming days when it receives more information from the government.

According to the Treasury, Chancellor Jeremy Hunt has spoken to Bank of England Governor Andrew Bailey about minimizing disruption from the SVBUK failure.

Andrew Griffiths, the economic secretary to the Treasury, is due to hold a roundtable with representatives of affected firms to discuss their concerns.

SVBUK said it would be declared insolvent from Sunday evening. It is a subsidiary of Silicon Valley Bank (SVB) and was the first location opened outside the US.

The bankruptcy declaration came after SVB was placed under US government control on Friday.

The Bank of England said the firm would stop making payments and accepting deposits.

The move will allow depositors to be paid up to £85,000 from the Deposit Insurance Scheme.

A statement on the SVB website said: “We are announcing that following negotiations with the Prudential Regulatory Authority, there is an intention, barring the event of any intervention, to put Silicon Valley Bank UK Ltd into bankruptcy from Sunday evening .

“We are determined to serve on behalf of our customers and our employees are proud to be associated with you.

“If customers have any questions please contact us and we will do our best to answer any and all questions you may have.”

The Bank of England statement said: “The Bank of England, in the absence of any meaningful information, intends to apply to the Court of Justice to place Silicon Valley Bank UK Limited (‘SVBUK’) in the bank insolvency process.

“A bank insolvency process would mean that eligible depositors are paid by the FSCS up to the protected limit of £85,000, or £170,000 for joint accounts, as soon as possible.

“The other assets and liabilities of SVBUK will be managed by the bank liquidator in bankruptcy and the recovery will be distributed to its creditors.

“SVBUK has a limited presence in the UK and no significant functions supporting the financial system.

“In the interim, the firm will stop making payments or accepting deposits.”

Credit: /

- Advertisement -

Recent Articles

Related Stories