News of HSBC's acquisition of Silicon Valley Bank UK (SVB UK) has brought huge relief to the UK tech community and wider economy – quite possibly the optimal result in the circumstances following the Bank of England's announcement of a likely insolvency procedure on Friday 10 March.
Summary
In what was described as a “momentous decision for company law”, the Supreme Court in BTI 2014 LLC v. Sequana SA and Others [2022] UKSC 25 (“Sequana”) confirmed the existence of a duty owed by company directors to consider the interests of its creditors when nearing insolvency.
It marks the first time the nature, scope, and content of directors’ duties to creditors when a company is nearing insolvency has been considered by the Supreme Court.
Our last newsletter commented on high inflation, dwindling business confidence and international supply chain issues. Those factors continue to influence the economic outlook, with some businesses unable to survive the strengthening head winds impacting the economy. The consumer price index increased 7.2 percent in the 12 months to December 2022, remaining stubbornly high despite significant movements in the official cash rate to 4.5%, up significantly from the 0.25% it was sitting at in October 2021. ANZ's economic forecast warns that a "policy induced recession is looming".
A large number of UK companies are in significant financial distress at the moment.
This article provides information regarding what will now happen to the operations and business of the UK arm of Silicon Valley Bank (SVB UK) after the sale (the Sale) of SVB UK to HSBC’s ring-fenced UK subsidiary, HSBC UK Bank plc (HSBC).
WE CONSIDER BELOW THE SHARE CHARGE ENFORCEMENT OPTIONS FOR PRIVATE CREDIT LENDERS, WHO MAY NOW COME TO PREFER 'APPROPRIATION' AS THE LESS FORMAL, MORE IMMEDIATE 'LOAN-TO-OWN' TOOL TO SOLVE FOR BORROWER JV DISPUTES, BREAK SHAREHOLDER DEADLOCKS, AND AS A PROACTIVE MEANS TO PRESERVE VALUE IN A CREDIT.
There are many practical steps, pitfalls and strategies available for recovering commercial rent arrears, both before and after tenant insolvency
The Bank of England (BoE) has announced that Silicon Valley Bank UK Limited (SVB UK) will be sold to HSBC UK Bank Plc (HSBC). This is being carried out under the aegis of the Special Resolution Regime (SRR) — a bespoke pre-insolvency regime applicable to failing banks1 — set forth in the Banking Act 2009 (the Act).
GIVEN THE RECENT NEWS REGARDING SILICON VALLEY BANK, RICHARD OMAN LOOKS AT THE IMPACT THAT LENDER INSOLVENCY HAS ON LOAN FACILITIES AND WHAT BORROWERS AND LENDERS NEED TO CONSIDER.
BACKGROUND