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HSBC to Buy UK Arm of Silicon Valley Bank

bbc.co.uk

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Re: HSBC to Buy UK Arm of Silicon Valley Bank

#51

Post by joosters »

mytailorisrich wrote: post #20
cjrp wrote: post #16

Seems like a great deal for HSBC? Presumably the competition regulator gives deals like this a free pass. > As at 10 March 2023, SVB UK had loans of around £5.5bn and deposits of around £6.7bn. For the financial year ending 31 December 2022, SVB UK recorded a profit before tax of £88m.

If the BoE took them over and HSBC bought them for £1 you can be sure that those numbers do not reflect the current situation.

Oddly, it had been reported that the bidding process for the bank was 'competitive' and that there were several interested parties. I can't see how that could have been true if the final price was a token £1 ?

Re: HSBC to Buy UK Arm of Silicon Valley Bank

#52

Post by thiago_fm »

neom wrote: post #32
arcticbull wrote: post #4

Earlier quoted context omitted.

Too bad HSBC USA didn't take the US arm. HSBC have been exiting the US market for a while and more competition is always better.

HSBC just restructured, I've been an HSBC US customer for 10 years including business banking, they're not going anywhere, just only serving high net worth and business now. I agree it would have been nice if they bought SVB, they'v been great for me with my startups, they're really good at business banking.

I want to build a business someday, and have always been interested on what to watch for when looking for a business bank as a founder.

Do you mind sharing why do you think HSBC is a good business bank and what are the typical qualities a business needs to have to be great for founders?

Re: HSBC to Buy UK Arm of Silicon Valley Bank

#53

Post by joosters »

al_be_back wrote: post #24

Surprised Goldmans didn't buy them - and position it as Marcus for Startups.

They're already losing enough money with Marcus right now, why risk losing some more? Goldman needs to figure out how to properly run their existing consumer bank first.

Re: HSBC to Buy UK Arm of Silicon Valley Bank

#54

Post by martinald »

neilwilson wrote: post #45
rvnx wrote: post #35

Earlier quoted context omitted.

But all weekend SVB UK has been claiming that SVB UK has no issue and is totally safe. So if sold for 1 GBP, it's literally a steal.

It's was totally safe until Monday morning when all the depositors would leave. HSBC has a huge Sterling reserve buffer that can easily accommodate that exodus. (Essentially HSBC UK becomes the depositor of last resort in SVB UK). Remember that the issue with SVB was that it was taking duration risk when it hadn't the deposits to match that duration. The HSBC parent company can easily provide that duration. Cashflow…

As far as I understand SVB UK did not have a duration risk like the parent co.

Re: HSBC to Buy UK Arm of Silicon Valley Bank

#55

Post by fredoralive »

salawat wrote: post #38
donw wrote: post #3

I read this as "HSBC to Arm Silicon Valley Bank", which is an entirely different customer-management strategy.

In the UK, the bobbies may not be packing, but the bankers sure are. Somehow, though, I could actually see that being a thing.

Well, during grouse season there are probably going to be a fair few armed bankers about.

Re: HSBC to Buy UK Arm of Silicon Valley Bank

#56

Post by sebzim4500 »

joosters wrote: post #51
mytailorisrich wrote: post #20

Earlier quoted context omitted.

If the BoE took them over and HSBC bought them for £1 you can be sure that those numbers do not reflect the current situation.

Oddly, it had been reported that the bidding process for the bank was 'competitive' and that there were several interested parties. I can't see how that could have been true if the final price was a token £1 ?

Maybe other bidders weren't willing or able to guarantee all deposits?

Re: HSBC to Buy UK Arm of Silicon Valley Bank

#57

Post by neom »

thiago_fm wrote: post #52
neom wrote: post #32

Earlier quoted context omitted.

HSBC just restructured, I've been an HSBC US customer for 10 years including business banking, they're not going anywhere, just only serving high net worth and business now. I agree it would have been nice if they bought SVB, they'v been great for me with my startups, they're really good at business banking.

I want to build a business someday, and have always been interested on what to watch for when looking for a business bank as a founder. Do you mind sharing why do you think HSBC is a good business bank and what are the typical qualities a business needs to have to be great for founders?

For me: Strong account manager who takes the time to understand the business, doesn't send you forms to fill in that don't have basic info already filled in for you, mostly don't bother you, when there are issues does most of the work to resolve them and only rely on you to do the last leg, don't offer products or services unless they're relevant, uses online tools like docusign or their internal equivalent, has good online banking, mostly doesn't bother you.

Re: HSBC to Buy UK Arm of Silicon Valley Bank

#58

Post by mytailorisrich »

joosters wrote: post #51
mytailorisrich wrote: post #20

Earlier quoted context omitted.

If the BoE took them over and HSBC bought them for £1 you can be sure that those numbers do not reflect the current situation.

Oddly, it had been reported that the bidding process for the bank was 'competitive' and that there were several interested parties. I can't see how that could have been true if the final price was a token £1 ?

£1, plus all deposits, plus all other liabilities (from what I understand).

Maybe the other bidders were not offering that much...

Re: HSBC to Buy UK Arm of Silicon Valley Bank

#59

Post by bognition »

kriro wrote: post #40

Great play by HSBC. It's very interesting because some banks will make out very nicely in the comming weeks and some will be dragged down a lot by the general pull of the market. HSBC already found some "free money" right away. I think at least one of the big US banks will also print some money (I'd bet on JPM).

What is “free money” and how does a big bank print money?

Re: HSBC to Buy UK Arm of Silicon Valley Bank

#60

Post by short_sells_poo »

bognition wrote: post #59
kriro wrote: post #40

Great play by HSBC. It's very interesting because some banks will make out very nicely in the comming weeks and some will be dragged down a lot by the general pull of the market. HSBC already found some "free money" right away. I think at least one of the big US banks will also print some money (I'd bet on JPM).

What is “free money” and how does a big bank print money?

They acquired a bunch of client assets for 1 GBP. Those client assets will generate money for them in the long term. For HSBC this is a great deal. For the clients too, come to think of it. On Friday the future of their money was uncertain, whereas today they can relax a bit because a big bank is backing them.
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