Do. Jun 13th, 2024

Summary

  • HSBC Holdings plc, a British multinational universal bank, has acquired SVB UK subsidiary for £1 following the takeover of Silicon Valley Bank by the United States Federal Deposit Insurance Corporation (FDIC).
  • SVB UK had loans of around £5.5 billion and deposits of around £6.7 billion as of March 10, 2023.
  • The US federal government and the UK administration have stepped in to save the banking crisis, with the Biden administration pledging $25 billion to bolster SVB banking operations.

HSBC Acquires SVB UK Subsidiary for £1

Following the takeover of Silicon Valley Bank by the United States Federal Deposit Insurance Corporation (FDIC) over the weekend, SVB’s UK subsidiary has been acquired by HSBC Holdings plc, a British multinational universal bank, and financial services holding company, for £1.

Bank Customers Can Now Bank Through HSBC

According to the announcement, SVB UK had loans of around £5.5 billion and deposits of around £6.7 billion as of March 10, 2023. Reportedly, SVB UK recorded a profit before tax of £88 million for the financial year ending 31 December 2022. HSBC Holdings noted that SVB UK’s tangible equity is expected to be around £1.4 billion. As such, the final calculation of the gain arising from the acquisition will be provided later. Noel Quinn, HSBC Group CEO said that this acquisition makes excellent strategic sense for its business in the United Kingdom and enhances its ability to serve innovative and fast-growing firms in the country.“We welcome SVB UK’s customers to HSBC and look forward to helping them grow in the UK and around the world,“ Quinn added.

UK & US Governments Step In To Save Banking Crisis

Less than three days following Silicon Valley Bank’s collapse which serviced businesses and high-net-worth customers across countries like USA & India among others; both US federal government & UK government have swiftly stepped in towards saving this banking crisis. The Biden Administration has pledged $25 Billion while Chancellor Jeremy Hunt from Britain announced his decision towards looking into this matter so as to avoid damage being caused out to some promising companies existing in market space today .

Conclusion

The acquisition strengthens HSBC’s commercial banking franchise and provides assurance about their deposits being backed by strength , safety & security of one among world’s largest global banks – HSBC . It also provides an opportunity for new customers towards experiencing secure & safe banking through them .

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