SVB UK Resolution – Where Did The Powers Come From?

At 7am on 13 March 2023 Silicon Valley Bank UK Limited (SVB UK), the UK subsidiary of the US bank, was sold to HSBC UK Bank Plc (HSBC) for £1.

This marked one of the first bank resolutions under the Banking Act 2009.¹

The Banking Act 2009 provides for a range of powers and tools to "resolve" a bank with the objective of (among other things) ensuring continuity of banking services in the UK, protecting the stability of the UK financial system, protecting public confidence in the UK financial system, protecting public funds and protecting investors and depositors covered by the Financial Services Compensation Scheme (FSCS).

The use of these resolution powers was exercised under the Silicon Valley Bank UK Limited Mandatory Reduction and Share Transfer Instrument which came into force at 7am on 13 March 2023. We set out in this post a high-level overview of the powers exercised and what they mean.