Barclays has seen an increase in inquiries to switch or open business accounts
Silicon Valley Bank is the biggest US lender to fail in more than a decade. Picture: BLOOMBERG— British banks are seeing a pickup in inquiries to switch cash between institutions after the collapse of US tech lender Silicon Valley Bank, as contagion fears prompt some depositors to try to figure out the safest harbours for their funds.
The British government and the Bank of England have said the country’s banking system is safe, sound and well capitalised, while the UK arm of SVB was rescued by Europe’s largest bank HSBC on Monday. That means SVB UK’s customer deposits are safe and their loans supported, HSBC’s top bosses have said.
Franklin said a number of CEOs and start-up execs had started researching other banks with which to park cash in addition to SVB UK this week, citing Barclays as a favourite among some. Russ Shaw, founder of start-up industry body Tech London Advocates, said he would advise start-ups to spread their capital between different bank accounts as a matter of course. “I suspect many learnt this weekend about the risk of not doing this,” he said.Rapid interest rate rises by the Bank of England over the past 15 months had already spurred greater competition among lenders for depositors, with smaller players gaining the upper hand as they were quicker to raise rates on products.
“While the issues that SVB experienced were very much institution-specific, it has raised generalised concerns around the health of bank balance sheets,” he said, adding that some specialists may actually be less exposed as they rely mainly on consumer deposits. Digital banking platform Revolut saw a 5% increase in new sign-ups from businesses, particularly larger companies, last week compared to previous weeks, and a “substantial increase” in overnight balances, a spokesperson said.
South Africa Latest News, South Africa Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Markets remain fragile after SVB collapseMany of the ingredients are there for sentiment to recover but only time will tell if this lasts, one analyst says
Read more »
Wall Street analysts warn of possibility of recessionGoldman Sachs and JPMorgan say SVB downfall could result in slump
Read more »
THE FINANCE GHOST: The Lehman Bros of Silicon ValleyThe implosion of SVB is a cautionary tale to all other lenders on how not to manage interest rate risk
Read more »
ISAAH MHLANGA: Be wary of calls for quick and easy solutions that invite crisisThe collapse of SVB should be a lesson on how not to act when good times turn bad
Read more »
Transaction Capital still not cheap[ICYMI] MoneywebNow podcast with SimonBrown, LonwaboMaqubela Maqubela of Perpetua Investment Managers on Stadio results. PatrickMathidi Aluwani Capital on Transaction Capital. AntonEser 10X, on the SVB crisis. Download podcast:
Read more »