HSBC has turned Silicon Valley Bank’s U.K. operations into its innovation banking arm after acquiring it for 1 pound ($1.24) on March 13, 2023. 

The mini-banking crisis in March 2023 caused by the collapse of SVB and Signature Bank led to the fire sale of SVB’s U.K. operations. 

The $3 trillion HSBC’s new innovation banking arm is comprised of the former SVB U.K. team and clients, David Sabow, head of U.S. innovation banking, told BAN. Sabow formerly led the technology and health care verticals at SVB in California. 

HSBC innovation banking supports startups on their path to IPO, Sabow said, adding that the bank at times also invests in them. 

“On the venture side, investments are always focused on what are the strategic needs across the different functions or businesses within HSBC” or the needs of the bank’s partners, Sabow said. 

The London-based bank focuses its venture investments mainly on fintech, biotech, climate tech and enterprise software companies, Sabow said. 

In 2024, HSBC invested in: 

• Gen AI-driven data management service provider Recogni;  

• Electric vehicle and grid manufacturer Weavegrid; and 

• Biotech startup Elegen Bio. 

HSBC did not disclose the total amount its innovation arm invested in 2024. However, Sabow told Bank Automation News that the innovation arm’s headcount, venture debt invested and client acquisitions all doubled last year. 

Global expansion of innovation banking 

The innovation banking arm began operations the weekend after HSBC acquired SVB, and global expansion began within a month, Sabow said. It is “opening offices in London, New York, Paris, Tel Aviv and Hong Kong” to have global operations, he added. 

HSBC, which already operates in 58 countries, is looking to develop a business banking network for global startups and a global VC arm to fund innovators in different segments and regions. 

“Given the breadth of HSBC, global connectivity is really one of our unique superpowers as an institution,” Sabow said.   

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