SVB UK holds $3 billion of venture capital-backed firms' funds -survey

By Pablo Mayo Cerqueiro

LONDON (Reuters) - British start-ups backed by venture capital have around 2.5 billion pounds ($3 billion), largely in deposits, "locked" in Silicon Valley Bank's UK subsidiary, according to a weekend survey by an industry body seen by Reuters.

The total includes more than 300 companies with accounts at SVB UK, more than a third of which risk running into cash-flow difficulty within a month if no solution is found for the ailing lender, the survey found.

Regulatory disclosures show SVB had some $2.9 billion worth of loans at its UK arm at the end of last year, along with more than $1 billion in bonds. The total volume of deposits at the British subsidiary is unclear.

In addition to their portfolio companies, venture capital and private equity funds are also customers of SVB UK, some of whom have been pulling deposits, one senior banker familiar with the matter said.

SVB UK offers short-term “capital call” facilities to venture capital funds, providing them with bridge financing before they receive cash from their investors, that person said.

Lobby groups have called on British authorities to ensure tech companies retain access to cash.

British Prime Minister Rishi Sunak has said the government is working to find a solution to limit the potential hit to companies resulting from the demise of SVB.

($1 = 0.8301 pounds)

(Reporting by Pablo Mayo Cerqueiro; Editing by John O'Donnell and Alexander Smith)