- HSBC’s UK Arm to acquire Silicon Valley Bank UK Limited (SVB UK) for £1.
- Circle’s USDC stablecoin is making its way back up to $1 after losing its peg to the US dollar
Silicon Valley Bank has already begun to see the light, as a banking giant has shown interest in purchasing the now-collapsed bank.
According to an announcement made by HSBC Holdings, its branch situated in the United Kingdom will go on to acquire Silicon Valley Bank UK Limited (SVB UK).
HSBC’s subsidiary will be purchasing Silicon Valley Bank UK Limited for £1 ($1.21). The announcement was made on the 13th of March and Noel Quinn, the CEO of HSBC Group remarked that the move is perfect for its business in the country. The CEO also stated that with the acquisition, its banking franchise and services to other innovative firms will be strengthened.
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.
In the announcement, it was also noted that SVB UK had loans of around £5.5 billion, and £6.7 billion in deposits, as of March 10th, 2023. Profit before tax from December 31, 2022, totaled £88,000,000, and tangible equity is expected to be at £1.4 billion. Shareholders will be updated on the accusation during its Q1 2023 results, on May 2nd, 2023.
HSBC will provide the final calculation of the gains birthed from the acquisition at a later time. However, the liabilities and assets of the parent companies of SVB UK are not included in the transaction. The acquisition of the bank will be funded from existing resources, HSBC noted.
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.
Circle’s USDC stablecoin is on its way to $1
In a positive turn of events, Circle’s USDC is making a quick recovery, after losing its peg to $1 during the weekend. The stablecoin hit a low of $0.87 during the weekend but has now gone on to attain gains going up to 3.55 percent in the last 24 hours. At press time, USD Coin (USDC) is valued at $0.99, and could potentially clutch $1 in the near term.
USDC’s price drop was recorded not long after Circle revealed that $3.3 billion of its reserve was at Silicon Valley Bank. However, Jeremy Allaire, the CEO of Circle has taken to Twitter to disclose that all of USDC’s reserves are now safe.
100% of USDC reserves are also safe and secure, and we will complete our transfer for remaining SVB cash to BNY Mellon. As previously shared, liquidity operations for USDC will resume at banking open tomorrow morning.
Update thread on USDC
We were heartened to see the US government and financial regulators take crucial steps to mitigate risks extending from the fractional banking system.
100% of deposits from SVB are secure and will be available at banking open tomorrow.
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— Jeremy Allaire (@jerallaire) March 12, 2023