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Bid launched to save Silicon Valley Bank's British division

Bad tech: British SVB boss Erin Platts sought to reassure customers on Friday

Official bailout bid for failed UK branch of Silicon Valley Bank submitted by Bank of London-led consortium

  • The government scrambles to limit the fallout from the crisis at the SVB
  • Collapse threatens to destabilize swathes of Britain’s tech sector
  • Bank of London, founded just two years ago, was the first to submit a proposal

A formal bailout bid for the UK branch of bankrupt Silicon Valley Bank was submitted last night by a consortium led by the Bank of London.

It came as the government scrambled to limit the fallout from the crisis at SVB, which threatens to destabilize large swaths of Britain’s tech sector.

The Bank of London, founded just two years ago, is a relative minnow compared to companies like Barclays and Lloyds – which have also reportedly been probed in bids.

But he was the first to put forward a proposal for consideration by the company’s board as well as the Treasury and the Bank of England amid fast-paced events following SVB’s demise last Friday.

Bank of London founder and chief executive Anthony Watson said: “Silicon Valley Bank cannot be allowed to fail given the vital community it serves.”

Bad tech: British SVB boss Erin Platts sought to reassure customers on Friday

Bad tech: British SVB boss Erin Platts sought to reassure customers on Friday

“This is a unique opportunity to ensure a more diversified banking industry in the UK, while enabling the continuity of service to SVB’s UK customers.

“It would be deeply disappointing if this moment led to a further consolidation of power among the big banks.”

Another lender, Oaknorth, has also been in talks over a bid while a Bloomberg report said Abu Dhabi’s Royal Group had expressed interest.

Rothschild advisors oversee the fire sale process.

SVB UK reportedly held £7billion in deposits when the Bank of England placed it in insolvency proceedings on Friday night. It had requested £1.8bn of short-term funding from the Bank before collapsing when billions of pounds were withdrawn.

Fintech company Revolut saw a 16-fold increase in funds transferred from Silicon Valley Bank late last week as its finances plummeted.

SVB UK is led by Erin Platts, an American who joined its US parent company in 2004 before moving to Britain in 2007 and taking over as UK and Europe lead in 2019.

Platts sought to reassure customers on Friday, hours before the Bank of England intervened, saying the firm was a stand-alone entity with its own governance and balance sheet.

The bank, which also covers European customers, only became a separate entity in September.

No to bailout, says Yellen, despite plea for more help

No bailout: Treasury Secretary Janet Yellen

No bailout: Treasury Secretary Janet Yellen

US authorities were working last night to contain the fallout from the demise of Silicon Valley Bank, fearing US regional banks could be the next to be hit.

Biden administration officials were weighing the impact of the collapse on other lenders as well as venture capitalists.

Treasury Secretary Janet Yellen told CBS News: ‘We want to make sure the problems at one bank don’t spread to others that are healthy.

But she ruled out a financial crisis-style bank bailout, adding: “We’re not going to do it again.”

More than 3,500 bosses have signed a petition calling on Yellen to protect their deposits at Silicon Valley Bank, saying more than 100,000 jobs could be at risk.

The California-based lender, with over £170bn in assets, was the 16th largest US bank. It is the largest bank to fail since the 2008 crisis.

Hedge fund manager Bill Ackman said failure to protect depositors could see them withdraw funds from regional banks “and begin the destruction of these important institutions”.

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