London Daily

Focus on the big picture.
Monday, Jun 02, 2025

Britain to bolster the City after Silicon Valley Bank collapse

Britain to bolster the City after Silicon Valley Bank collapse

The collapse of Silicon Valley Bank has shown the need to build a larger and more diverse financial system by bolstering the stock market and unlocking cash in pension schemes, Britain's finance minister Jeremy Hunt said on Wednesday.
Following the collapse of its parent company in the United States, Silicon Valley Bank's UK arm was sold to HSBC over the weekend to avoid disrupting its customers in Britain. SVB was heavily focused on lending to the technology sector.

Fallout from the collapse continued to roil banking shares in Europe on Wednesday.

Referring to current volatility in markets on the back of rising global interest rates, Hunt's budget said regular stress testing by the Bank of England means that UK banks are "well placed" to weather economic shocks.

The "wider UK banking system remains safe, sound and well capitalised", it said.

But the rapid sale of SVB's UK unit last weekend showed that "we need to build a larger, more diverse financing system, where the benefits of investment in high growth firms are available to more investors", Hunt said.

Hunt said he would make a statement in the autumn on how the UK financial system would be strengthened.

"It will include measures to unlock productive investment from defined contribution pension funds and other sources, make the London Stock Exchange a more attractive place to list, and complete our response to the challenges created by the U.S. Inflation Reduction Act," Hunt told parliament in his budget statement.

Julia Hoggett, chief executive of London Stock Exchange plc, said the listings debate affects everyone as money put to work in capital markets drives economic growth.

"Pace and precision of regulatory reform are needed, including to listing rules and other expectations placed on listed companies," Hoggett said.

Chris Hayward, policy chairman at the City of London Corporation, said the government has listened to calls on how defined contribution funds can be better used to support high-growth industries.

"We have been working with the sector on a Future Growth Fund - a 50 billion pound fund - which will give DC pension savers the chance to invest in growth companies," Hayward said.

City Minister Andrew Griffith has said that an accounting rule for pension funds has become a "performance penalty" which holds back investment in Britain.

A decision by UK chip designer Arm to only list in New York has dismayed the City of London, triggering calls for faster reforms to help the capital's financial district compete better with leader New York in global tech listings.

UK listing rules have been amended after Britain left the European Union in 2020 and Britain has set out a welter of proposed post-Brexit changes to capital market rules known collectively as the Edinburgh Reforms.

The financial sector has called for faster implementation of the proposals after Amsterdam overtook London as Europe's biggest share trading centre.

On Wednesday, the government said it would consider possible reforms to simplify the value-added tax (VAT) treatment of financial services. It also remains committed to disposing of by 2026 its now-minority stake in NatWest Group, acquired during a bailout of the lender during the 2007-09 financial crisis.
Newsletter

Related Articles

0:00
0:00
Close
Ukraine Executes Long-Range Drone Strikes on Russian Airbases
Conservative Karol Nawrocki wins Poland’s presidential election
Study Identifies Potential Radicalization Risk Among Over One Million Muslims in Germany
Good news: Annalena Baerbock Elected President of the UN General Assembly
Apple Appeals EU Law Over User Data Sharing Requirements
South Africa: "First Black Bank" Collapses after Being Looted by Owners
Poland will now withdraw from the EU migration pact after pro-Trump nationalist wins Election
"That's Disgusting, Don’t Say It Again": The Trump Joke That Made the President Boil
Trump Cancels NASA Nominee Over Democratic Donations
Paris Saint-Germain's Greatest Triumph Is Football’s Lowest Point
OnlyFans for Sale: From Lockdown Lifeline to Eight-Billion-Dollar Empire
Mayor’s Security Officer Implicated | Shocking New Details Emerge in NYC Kidnapping Case
Hegseth Warns of Potential Chinese Military Action Against Taiwan
OPEC+ Agrees to Increase Oil Output for Third Consecutive Month
Jamie Dimon Warns U.S. Bond Market Faces Pressure from Rising Debt
Turkey Detains Istanbul Officials Amid Anti-Corruption Crackdown
Taylor Swift Gains Ownership of Her First Six Albums
Bangkok Ranked World's Top City for Remote Work in 2025
Satirical Sketch Sparks Political Spouse Feud in South Korea
Indonesia Quarry Collapse Leaves Multiple Dead and Missing
South Korean Election Video Pulled Amid Misogyny Outcry
Asian Economies Shift Away from US Dollar Amid Trade Tensions
Netflix Investigates Allegations of On-Set Mistreatment in K-Drama Production
US Defence Chief Reaffirms Strong Ties with Singapore Amid Regional Tensions
Vietnam Faces Strategic Dilemma Over China's Mekong River Projects
Malaysia's First AI Preacher Sparks Debate on Islamic Principles
White House Press Secretary Criticizes Harvard Funding, Advocates for Vocational Training
France to Implement Nationwide Smoking Ban in Outdoor Spaces Frequented by Children
Meta and Anduril Collaborate on AI-Driven Military Augmented Reality Systems
Russia's Fossil Fuel Revenues Approach €900 Billion Since Ukraine Invasion
U.S. Justice Department Reduces American Bar Association's Role in Judicial Nominations
U.S. Department of Energy Unveils 'Doudna' Supercomputer to Advance AI Research
U.S. SEC Dismisses Lawsuit Against Binance Amid Regulatory Shift
Alcohol Industry Faces Increased Scrutiny Amid Health Concerns
Italy Faces Population Decline Amid Youth Emigration
U.S. Goods Imports Plunge Nearly 20% Amid Tariff Disruptions
OpenAI Faces Competition from Cheaper AI Rivals
Foreign Tax Provision in U.S. Budget Bill Alarms Investors
Trump Accuses China of Violating Trade Agreement
Gerry Adams Wins Libel Case Against BBC
Russia Accuses Serbia of Supplying Arms to Ukraine
EU Central Bank Pushes to Replace US Dollar with Euro as World’s Main Currency
Chinese Woman Dies After Being Forced to Visit Bank Despite Critical Illness
President Trump Grants Full Pardons to Reality TV Stars Todd and Julie Chrisley
Texas Enacts App Store Accountability Act Mandating Age Verification
U.S. Health Secretary Ends Select COVID-19 Vaccine Recommendations
Vatican Calls for Sustainable Tourism in 2025 Message
Trump Warns Putin Is 'Playing with Fire' Amid Escalating Ukraine Conflict
India and Pakistan Engage Trump-Linked Lobbyists to Influence U.S. Policy
U.S. Halts New Student Visa Interviews Amid Enhanced Security Measures
×