SVB’s collapse: Shanghai weighs a buyout of SVB in local venture while HSBC steps up as white knight for collapsed bank’s UK unit
- HSBC has swooped in to buy the collapsed bank’s UK subsidiary for a nominal £1
- the US bank’s subsidiary in China may be taken over by its Chinese partner Shanghai Pudong Development Bank (SPDB), according to sources familiar with the matter
The Silicon Valley Bank’s (SVB) global operations are being taken apart after the California-based lender was taken over by regulators on Friday, becoming the second biggest bank failure in the history of the United States.
Shanghai’s banking authorities are now discussing plans to deal with SVB’s venture (SPD-SVB) in the city as they try to play down the psychological impact brought by a run on the lender’s deposits in the United States. SPD-SVB has invested in five companies since 2014, most recently in InxMed’s US$10 million funding in July 2022, according to Crunchbase’s data.
SPDB is likely to buy out the 50 per cent stake held by its American partner, the sources said, adding that it is the “top choice” in a range of options. The Shanghai government and the banking regulator’s branch in the city held emergency meetings over the weekend after the Federal Deposit Insurance Corporation (FDIC) took over SDB, the officials said, asking not to be identified.
Another option would be to allow another foreign investor to buy out SVB, the sources said, adding that the authorities will find a solution soon for the venture. Shanghai’s municipal government did not respond to queries posted by the Post.