![]() ![]() Mr Hunt said: 'The UK's tech sector is genuinely world-leading and of huge importance to the British economy, supporting hundreds of thousands of jobs. The transaction was 'facilitated' by the Bank of England in consultation with the Treasury, using powers introduced after the 2008 Credit Crunch. HSBC bought the UK arm for the nominal sum of £1, taking on its liabilities. The Bank of England then ordered the UK subsidiary of SVB into insolvency from last night.īut that left more than 200 small British tech firms facing potentially catastrophic cashflow problems, with an estimated £2.5billion of capital in SVB. The US government acted to head off banking sector contagion after the failure, protecting all deposits. The crisis erupted when California-based parent company Silicon Valley Bank imploded and had its assets seized by US regulators on Friday - the largest failure of a bank since the financial crisis. Barclays was down more than 5 per cent, while HSBC and Lloyds dropped 4 per cent.Ī quarter-point rise in the BoE's base rate had been priced in as a certainty by traders, but the implied probability has plunged to barely 70 per cent. The Chancellor insisted all deposits had been protected as part of the government-brokered purchase, and customers will be able to access their deposits and banking services as normal.īut concerns about spread remain, with regulators announcing yesterday that New York-based Signature Bank had also failed and was being seized.īanks, which dominate the British blue-chip index, were heavily lower after steep falls on Friday. The FTSE 100 tumbled more than 2 per cent today despite HSBC buying the UK arm of the stricken firm and Jeremy Hunt stressing the 'resilience' of the financial system. The chances of the Bank of England inflicting further pain on mortgage-payers has been significantly downgraded after the collapse of Silicon Valley Bank in the US. Markets are betting that fears of a banking sector meltdown could put a stop to more interest rate hikes. ![]()
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