Silicon Valley Bank: 500 jobs cut by new owner First Citizens

2 weeks ago 46

Silicon Valley Bank branchImage source, Getty Images

By Mariko Oi

Business reporter

The caller proprietor of Silicon Valley Bank's (SVB) US operations, First Citizens, is cutting astir 500 roles held by erstwhile SVB workers, the BBC understands.

Two months ago, First Citizens bought the concern aft SVB's collapse.

The nonaccomplishment of SVB, on with 2 different US banks, triggered fears of a much wide banking crisis, which forced authorities to measurement in.

SVB's concern successful the UK was bought successful March by London-headquartered banking elephantine HSBC for a nominal £1 ($1.25).

In an email seen by the BBC, First Citizens' main enforcement Frank Holding highlighted the problems faced by SVB earlier this twelvemonth and said the cuts volition affect: "select SVB firm functions and bash not see immoderate unit successful client-facing positions."

"The squad successful India that supports SVB is not impacted by the changes," helium added.

The BBC understands that the occupation cuts magnitude to astir 3% of the company's full workforce.

The communicative was archetypal reported by US-based quality website Axios.

First Citizens is based successful Raleigh, successful the US authorities of North Carolina and calls itself America's biggest family-controlled bank. It has been 1 of the largest buyers of troubled banks successful caller years.

Under the deal, each 17 erstwhile SVB branches opened nether the First Citizens brand.

In the UK, HSBC bought SVB's British operations successful a woody led by the authorities and the Bank of England. Earlier this month, HSBC said its profits had got a $1.5bn boost from the takeover.

Also this month, Greg Becker, the erstwhile brag of SVB, apologised during a Congressional testimony, blaming rising involvement rates and mounting withdrawals by customers arsenic cardinal causes of the bank's collapse.

Interest rates were chopped sharply during the 2008 planetary fiscal situation and again during the Covid pandemic arsenic cardinal banks astir the satellite sought to promote economical growth.

But rates person been rising implicit the past twelvemonth arsenic cardinal banks effort to rein successful soaring prices.

These complaint rises person deed the worth of investments successful which astir banks support immoderate of their customers' money, and contributed to the slope failures successful the US.

His relationship contrasts with those of regulators who blamed SVB's enactment for its nonaccomplishment to negociate involvement complaint risks oregon diversify its business.

The illness of SVB was followed by the nonaccomplishment of different US lender, Signature Bank and aboriginal May, JP Morgan Chase took implicit First Republic, which had besides been nether pressure.

Meanwhile successful Europe, Swiss officials brokered a rescue woody for troubled banking elephantine Credit Suisse by its rival UBS, which Swiss prosecutors are investigating.

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