Governments in the US and Britain are taking extraordinary steps to stop a potential banking crisis after the historic failure of Silicon Valley Bank.
NEW YORK — Governments in the U.S. and Britain are taking extraordinary steps to prevent a potential banking crisis after the failure of California-based Silicon Valley Bank prompted fears of a broader upheaval.
Meanwhile, the Bank of England and U.K. Treasury said early Monday that they had facilitated the sale of the bank's London-based subsidiary to HSBC, Europe's biggest bank, ensuring the security of 6.7 billion pounds of deposits.when it experienced a traditional bank run, where depositors rushed to withdraw their funds all at once. It is the second-largest bank failure in U.S. history, behind only the 2008 failure of Washington Mutual.
The developments left markets jittery as trading began Monday. The Asian and European markets fell but not dramatically, and U.S. futures were down. The U.K. also moved quickly, working throughout the weekend to arrange the sale of Silicon Valley Bank UK Ltd., the California bank's British arm, for the nominal sum of one pound.
A pedestrian passes by the Hong Kong Stock Exchange in Hong Kong on Monday. Asian shares mostly fell Monday, shaken by a Wall Street tumble that set off worries the biggest U.S. bank failure in nearly 15 years might have ripple effects around the world. In the U.S., officials characterized their lending program as akin to what central banks have done for decades: Lend freely to the banking system so that customers would be confident that they could access their accounts whenever needed.
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