As per reports, Shanghai Pudong Development Bank may acquire the China-based subsidiary of Silicon Valley Bank (SVB). Officials in the Chinese city of Shanghai reportedly supported the acquisition, which could help cushion the impact of SVB’s shutdown. In its statement following SVB’s demise, SPD Silicon Valley Bank reportedly said that its operations remained stable.
Shanghai officials seek to limit impact of SVB’s death
Shanghai Pudong Development Bank (SPDB), a joint venture partner of the Silicon Valley bank, plans to acquire the China-based subsidiary of the collapsed financial institution. reports Where is it? As per reports, SPDB is likely to acquire the collapsed US Bank’s 50% stake in the subsidiary.
The plan to keep the financial institution’s subsidiary afloat comes just days after the Bank of England helped facilitate the acquisition of the collapsed bank’s subsidiary in the United Kingdom. British authorities have appreciated the acquisition of the subsidiary for £1 ($1.22) which protects depositors without using taxpayers’ money.
According to a report in the South China Morning Post, Shanghai banking authorities may support the acquisition, which could help the city weather the storm caused by the sudden closure of SVB. The report said the local government and the city’s banking regulators had discussed the possibility of SPDB acquiring a subsidiary operating in China as SPD Silicon Valley Bank.
While the Shanghai Banking Authority is also open to the idea of a non-Chinese entity buying the subsidiary, analysts cited in the report said this option may not be the most ideal for customers who want a quick resolution to the issue.
Meanwhile, in its statement after the spectacular collapse of SVB, SPD Silicon Valley Bank reportedly said that its operations remained stable. The subsidiary highlighted China’s banking regulations, which required it to maintain an independent balance sheet separate from its parent company.
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