HSBC Takes Over Silicon Valley Bank UK
HSBC UK Bank announced on Friday that it is acquiring Silicon Valley Bank UK (SVB UK) for a nominal amount of £1. The acquisition is set to boost HSBC’s commercial banking franchise and expand its capabilities to serve innovative and fast-growing firms in the UK and internationally, especially in the technology and life-science sectors.
HSBC Holdings plc announces that its UK ring-fenced subsidiary, HSBC UK Bank plc, is acquiring Silicon Valley Bank UK Limited (SVB UK) for £1. As at 10 March 2023, SVB UK had loans of around £5.5bn and deposits of around £6.7bn. https://t.co/hxVl09Z9n8
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Assets and Liabilities
SVB UK, which had loans of about £5.5bn and deposits of about £6.7bn as of March 10, 2023, recorded a pre-tax profit of £88m for the financial year ending December 31, 2022. Its tangible equity is expected to be around £1.4bn. The acquisition of SVB UK’s assets and liabilities will complete immediately, and the transaction will be funded from HSBC’s existing resources.
Strengthening Commercial Banking Franchise
Noel Quinn, HSBC Group CEO, expressed his excitement and said, “This acquisition makes excellent strategic sense for our business in the UK.” The acquisition is expected to help HSBC grow its business in the UK and around the world, strengthen its commercial banking franchise, and provide greater access to innovative and fast-growing firms.
“We welcome SVB UK’s customers to HSBC and look forward to helping them grow in the UK and around the world,” Quinn said. “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 and are excited to start working with them.”
Growth Strategy
HSBC will provide updates on the acquisition at its 1Q 2023 results on May 2, 2023. The move is part of HSBC’s broader strategic plan to grow its business in the UK and internationally, and this acquisition is expected to play a significant role in achieving this objective. The acquisition marks an exciting new chapter for SVB UK customers and employees, who will now become part of one of the world’s largest and most respected financial institutions.
