HSBC Holdings Plc on March 13 announced that its UK ring-fenced subsidiary, HSBC UK Bank plc, is acquiring Silicon Valley Bank UK Limited (SVB UK) for £1. SVB UK had loans of around £5.5 billion and deposits of around £6.7 billion as on March 10, 2023.

Had a buyer not been found, SVB UK would have been placed into insolvency by the Bank of England following the stunning collapse of its parent in the United States.

The UK central bank said that the action was taken to stabilise SVBUK, as well as ensure the continuity of banking services, minimise disruption to the UK technology sector and support confidence in the financial system.

In a statement, the central bank said it “can confirm that all depositors’ money with SVB UK is safe and secure as a result of this transaction.”

The central bank and the treasury “can confirm that all depositors’ money with SVBUK is safe and secure as a result of this transaction”, it said. The UK arm of SVB will continue to be operated normally by SVBUK, and all services will continue to operate as normal. Customers would not notice any changes, said the Bank of England.

The Bank of England also announced that the Monday announcement supercedes the announcement on March 10 that stated that without any meaningful further information, it intended to apply to the court to place SVBUK under Bank Insolvency Procedure.

The HSBC rescue is “fantastic news” for the UK startup ecosystem, said Piotr Pisarz, the CEO of Uncapped, a financial tech startup that lends to other startups.

In a statement, HSBC CEO Noel Quinn said the acquisition meant that “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.”