Impacted by SVB?

Impacted by SVB? Here is an outline, info, claim process and how to help lobby.

A Recap

SVB USA – US banking regulators took over the bank on Friday 9th March. The US Federal Deposit Insurance Corporation (FDIC) insures deposits upto $250,000. Beyond this there are questions.

SVB UK – a UK separate ring fenced bank but contagion from the US announcement made people withdraw money enemas causing a liquidity issue for the bank. It asked for ￡1.8bn of liquidity (cash) on Friday 9th March from the Bank of England. It was subsequently closed by the Bank of England with a view to taking into an insolvency process. Deposits of up to ￡85,000 are protected by the Financial Services Compensation Scheme (FSCS). Beyond this there are questions as to what is possible. A bit more on the insolvency process HERE.

UK Guide

SVB UK was a separate bank with separate investments to the US entity. It is quite possible that other than the liquidity position above it was generally solvent. Therefore there may be a high degree of assets available (like investments) that can be sold in order to repay creditors (including depositors like yourself). It’s is also possible that this doesn’t cover 100% of your exposure. At this time it’s unknown but we can hope!

The UK government seem to be actively engaging in a discussion about how to help HERE but I suspect we will need to wait a little longer for details and any concrete plans.

Consider the 3 things below:

1)???PLEASE HELP YOURSELF AND OTHERS >>> – if you are impacted complete the survey HERE so the BAA can use this information to help lobby government.?Midday Monday 13th latest!

2)???REVIEW YOUR REMAINING BANK RISK >>> Further contagion is possible if people start doubting how solid the next bank is. If you have significant deposits with any bank consider how to manage those and spread around. If you have significant deposits above the ￡85,000 threshold with any of the new challenger banks (Monzo, Revolute, Starling, Monzo, Atom etc) or any UK bank known to be weak (Metrobank for example) consider moving those around to reduce risk.

3)???ALWAYS >>> Consult your board and advisors on the above where possible

What to do?

Up to ￡85,000 on deposit

From 12th March SVB UK will be in insolvency (unless a buyer or other solution is found) Once there you need to claim with the FSCS. You can do this directly (free, see below) or via a claims management company (fee’s apply)

Claim - HERE

(SVB UK Reference No. 543146 - HERE)

Timeframe: Aim is within 7 days (this doesn’t happen very often) overview of claims process HERE

Over ￡85,000 on deposit

Hope for a buyer or government intervention

Claim as above

Lobby the BAA as above

Expect a separate claim via the insolvency process in due course (this could take many months)

Plan for the worst (see below) and hope for the best

It’s looking bad, what can I do?

1)???Review your current situation – amount of exposure, where it leaves you and if you were to recover nothing are you still solvent? Seek advice if you wish to do a review of solvency, especially if you are a trading business as there are legal risks to directors if you continue to trade in an insolvent state.

2)???What can you do? Well, you have a few actionable choices:

a.????Claim what you can (see above process for UK)

b.????Defer paying bills

c.????Cut expenses (yes this is everything including staff)

d.????Defer founder salary payments

e.????Borrow money (tricky if you are not profitable)

f.?????Raise investment from new or existing investor