The Silicon Valley Bank (SVB) closure, and subsequent Federal Deposit Insurance Corporation (FDIC) receivership, has created a plethora of legal implications and potential risks for the financial sector and other industries. Our U.S./UK multi-practice SVB Task Force provides guidance to those affected by this incident and other issues that will arise in connection with them.
SVB, the U.S.’s 16th largest bank, was closed on Friday, March 10, 2023 and the FDIC was appointed as receiver. On Sunday, March 12, the U.S. Department of the Treasury, Federal Reserve, and FDIC announced in a joint statement that all depositors of SVB would have access to all of their deposits (not just FDIC-insured deposit amounts) on Monday, March 13. Therefore, there is no loss to depositors associated with SVB’s closure.
SVB’s UK operations were conducted through its subsidiary, Silicon Valley Bank UK Limited (SVBUK). On Monday, 13 March 2023, HSBC UK Bank PLC bought the UK subsidiary for £1 with the deal announced at 7 a.m. (GMT) before markets opened. The Bank of England used special bank resolution powers under the Banking Act 2009 to effect the sale and has provided a temporary waiver from the UK’s ringfencing regime. Following the acquisition, HSBC and SVBUK have stressed that they intend to continue business as usual for SVBUK’s clients, including depositors and borrowers.
SVB UK has been acquired by HSBC UK Bank PLC. The transfer took place at 7 a.m. (GMT) on Monday, 13 March 2023. Following the transfer, SVB UK continues to operate as normal under new ownership as part of the HSBC group. Customers can access their deposits and draw down on existing facilities as normal.
Questions and concerns in relation to both SVB and SVBUK may be directed to the Silicon Valley Bank (SVB) Task Force at [email protected]. Please register here to receive timely updates and information on upcoming events hosted by our Task Force.
