Silicon Valley Bank UK (SVB UK) has handed out millions of pounds in employee bonuses, according to unnamed sources, just days after it was bailed out for just £1 by global banking giant HSBC.
On Sky News from March 18 message citing unnamed sources, it was reported that payments to SVB UK staff and executives were signed “earlier this week” by HSBC UK – an institution which received SVB UK for £1 ($1.22) on March 13.
It was reportedly “unclear” how much was awarded to SVB UK chief executive Erin Platts “or her senior colleagues”, however sources described the bonus pool as “modest” and said it totaled “£15m to £20m. ” (approximately US$18.26 million and US$24.35 million).
While insiders reportedly noted that if SVB UK “was not acquired solvently” the bonuses “would not have been paid out this week”, one insider reportedly “pointed out” that shares held by executives and other employees had been “paid out”. worthless” by the near collapse of SVB UK.
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Another insider reportedly added that the bonus payments were a “signal of HSBC’s confidence in the talent base” at SVB UK and were meant to match “previously agreed payments” in a bid to “retain key staff”.
SVB UK previously said in a tweet on March 17 that it was “delighted” to now be part of HSBC, after 14 years of supporting and “growing the UK’s innovative economy”.
For 14 years of supporting and growing Britain’s innovation economy @SVB_UK he is glad to be part of it now @HSBCwe are joining a successful global organization to support our and our client’s growth. #UKTech #SVBUK #Starups #HSBChttps://t.co/MNUl57S33Z
— SVB UK (@SVB_UK) March 16, 2023
This comes after the Bank of England cease operation SVB UK on 10 March, saying it has a “limited presence” and no “critical functions” supporting the financial system.
The statement declared that SVB UK would “stop making payments or accepting deposits” as the BoE intended to take legal action to put SVB into “bank insolvency proceedings”.
Meanwhile, SVB’s bank branch in the United States was taken over by the government and its holding company, SVB Financial Group, applied for Chapter 11 bankruptcy protection March 17 as it seeks buyers for its other assets.
SVB Group’s chief restructuring officer, William Kosturos, said the Chapter 11 process will allow SVB Financial Group to “preserve value as it evaluates strategic alternatives for its valuable businesses and assets.”
Kosturos emphasized that SVB Capital and SVB Securities will continue to operate under the leadership of their respective independent teams.