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Friday, Feb 23, 2024

HSBC to unveil shake-up of Silicon Valley Bank UK board

HSBC to unveil shake-up of Silicon Valley Bank UK board

Two of HSBC's top executives and one of the independent directors of its UK bank will join the board of Silicon Valley Bank UK, two months after buying it for £1.
HSBC is shaking up its new subsidiary, Silicon Valley Bank UK (SVBUK), by appointing a trio of senior figures as directors, two months after acquiring the US-owned lender in a £1 rescue deal.

Sky News has learnt that HSBC will announce on Tuesday that John Hinshaw, group chief operating officer; Stuart Tait, head of UK commercial banking; and Mridul Hegde, an independent director of HSBC's UK bank are joining the SVBUK board.

People close to the company said that Vin Murria, a technology entrepreneur, would be stepping down as an SVBUK director as part of the changes.

No imminent changes to SVBUK's executive leadership are planned, they added.

SVBUK's independent chairman Darren Pope is also expected to remain in place, at least for the time being.

The boardroom overhaul comes two months after HSBC swooped to buy the British arm of California-based Silicon Valley Bank in an emergency deal orchestrated by the Bank of England.

One insider said the new appointments represented a natural evolution under HSBC's ownership.

It also plans to rename SVBUK with a decision being announced as soon as London Tech Week next month.

In the US, SVB was taken into temporary public ownership after a run on the bank triggered by a crisis of confidence among depositors.

It was subsequently sold to First Citizens Bancshares, a regional US lender.

Sky News revealed in March that HSBC had signed off on the payment of just under £20m in bonuses to SVBUK staff.

One insider said at the time that the bonus payments were a signal of HSBC's confidence in the talent base at its new subsidiary and that it had been keen to honour previously agreed payments in order to help retain key staff.

Employing about 700 people in Britain, SVBUK is a profitable business but was brought to the brink of collapse by the travails of its American parent company.

An emergency auction in which Rishi Sunak, the prime minister, played a pivotal role had also drawn interest from challenger banks including OakNorth and The Bank of London.

Jeremy Hunt, the chancellor, said the rescue had been critical to preserving funding to some of the UK's most promising start-up companies.

"The UK's tech sector is genuinely world-leading and of huge importance to the British economy, supporting hundreds of thousands of jobs," he said.

The government had been lobbied intensively to intervene by hundreds of tech entrepreneurs about the parlous state of SVBUK.

They warned of "an existential threat to the UK tech sector", adding: "The Bank of England's assessment that SVB going into administration would have limited impact on the UK economy displays a dangerous lack of understanding of the sector and the role it plays in the wider economy, both today and in the future."

HSBC declined to comment.
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