UK working on cash lifeline for tech firms hit by Silicon Valley Bank collapse
The UK government is drawing up plans for an emergency cash lifeline for tech firms hit by Silicon Valley Bank UK’s (SVB UK) collapse that could help avoid any losses for startups that the chancellor, Jeremy Hunt, warned were at “serious risk”.
The chancellor said the issue was a “high priority” for the government, and that he had been locked in late-night meetings with the prime minister, Rishi Sunak, and the Bank of England governor, Andrew Bailey, in an attempt to avoid further fallout from the collapse of SVB UK’s American parent company on Friday. It marked the largest failure of a bank since the 2008 financial crisis.
“We will bring forward, very soon, plans to make sure people are able to meet their cashflow requirements and pay their staff but obviously what we want to do is to find a longer-term solution that minimises or even avoids completely losses to some of our most promising companies,” Hunt told Sky News, reiterating a statement released by the Treasury on Sunday morning.
While he insisted there was no systemic risk to the UK financial system, the chancellor said: “There is a serious risk to our technology and life sciences sectors, many of whom bank with this bank that most people won’t have heard of – the Silicon Valley Bank – but it happens to look after the money of some of our most promising and exciting businesses.”
The government has asked affected startups to disclose how much cash they had on deposit at SVB UK, as well as how much they tend to burn through each month, and whether they had access to any other bank accounts outside the collapsed lender.
The pledge to find an emergency cash lifeline was welcomed by tech firms and lobby groups, including the startup industry body Codec, which said it was
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