HSBC UK Bank, the UK ring-fenced subsidiary of HSBC Holdingshas acquired the Silicon Valley Bank (SVB) UK for £1.

The sale forms part of government and regulators’ efforts to protect the UK arm of US-based Silicon Valley Bank, which collapsed last week. 

In a statement, HSBC said, as of last week, SVB UK had about £5.5bn in loans and around £6.7bn in deposits.

SVB UK reported a profit before tax of £88m for the fiscal year that ended on 31 December 2022.

Its tangible equity is anticipated to be around £1.4bn.

SVB UK’s parent firms’ assets and liabilities are not included in the transaction, which completes immediately.

HSBC Group CEO Noel Quinn said: “This acquisition makes excellent strategic sense for our business in the UK. It strengthens our commercial banking franchise and enhances our ability to serve innovative and fast-growing firms, including in the technology and life-science sectors, in the UK and internationally.

“We welcome SVB UK’s customers to HSBC and look forward to helping them grow in the UK and around the world. 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, we are excited to start working with them.”

This step has been taken to stabilise SVB UK, guaranteeing the continuation of banking services, minimising interruption to the UK technology sector, and bolstering confidence in the financial system, the Bank of England (BoE) noted.

The BoE added: “The bank and HM Treasury can confirm that all depositors’ money with SVB UK is safe and secure as a result of this transaction. SVB UK’s business will continue to be operated normally by SVBUK. All services will continue to operate as normal and customers should not notice any changes.”