Bitcoin

Report: Shanghai Bank Mulls Buying Silicon Valley Bank’s Stake in Chinese Subsidiary

According to reports, Shanghai Pudong Development Bank may acquire the China-based subsidiary of Silicon Valley Bank (SVB). Authorities in the Chinese city of Shanghai reportedly back the acquisition, which may help minimize the impact of SVB’s shutdown. In its statement following SVB’s demise, SPD Silicon Valley Bank reportedly said its operations remained stable.

Shanghai Authorities Seek to Limit Impact of SVB’s Demise

Silicon Valley Bank’s joint venture partner Shanghai Pudong Development Bank (SPDB) plans to take over the collapsed financial institution’s China-based subsidiary, a report has said. According to the report, the SPDB is likely to acquire 50% of the collapsed U.S. bank’s stake in the subsidiary.

The plan to keep the financial institution’s subsidiary running came just days after the Bank of England helped to facilitate HSBC’s acquisition of the collapsed bank’s subsidiary in the United Kingdom. British authorities have lauded the acquisition of the subsidiary for £1 ($1.22) which protects depositors ostensibly without using taxpayers’ money.

According to a report in the South China Morning Post, Shanghai banking authorities may back the acquisition, which may help the city weather the storm sparked by SVB’s abrupt shutdown. The report added that the local government and the city banking regulators had discussed the possibility of SPDB’s takeover of the subsidiary which operates as SPD Silicon Valley Bank in China.

While Shanghai banking authorities are also open to the idea of a non-Chinese entity buying the subsidiary, analysts quoted in the report said this option may not be the most ideal for customers who want a quick resolution to the issue.

Meanwhile, in its statement following SVB’s spectacular collapse, SPD Silicon Valley Bank reportedly said its operations remained stable. The subsidiary highlighted China’s banking regulations which required it to maintain an independent balance sheet separate from its parent company.

Tags in this story

What are your thoughts on this story? Let us know what you think in the comments section.

Terence Zimwara

Terence Zimwara is a Zimbabwe award-winning journalist, author and writer. He has written extensively about the economic troubles of some African countries as well as how digital currencies can provide Africans with an escape route.














Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Read disclaimer

Articles You May Like

US borrowing binge risks market strains, analysts warn
The mother of all US presidential debates
Zilch warns it might ‘go somewhere else’ unless UK boosts IPO market
The absence of honesty in UK election will undermine democracy itself
Invested in the WFH argument? Home in on the evidence