The boss of ClearBank Ltd said clients moved 20% more money through its platform in the week of Silicon Valley Bank’s (SVB) implosion, adding the firm to a cohort of rivals benefiting from the collapse.
Charles McManus, chief executive officer (CEO) of the London-based clearing bank, said business has now begun to stabilise after the sudden jump. The firm’s balances at the Bank of England have risen to £3.7 billion ($4.5 billion) from about £3 billion at the end of last year.
“We’ve had a lot of inflow that’s driven that surplus cash in terms of flight to quality,” McManus said in an interview.
The UK unit of Silicon Valley Bank was rescued by HSBC Holdings Plc on March 13 after a hastily-arranged sale process run by the Bank of England. An exodus of mostly tech-sector clients had led to the failure of SVB’s US parent firm a few days prior.
The collapse worsened jitters about risks in the wider banking sector, but it meant rivals from Goldman Sachs to Revolut have been able to snatch more customers.
Emma Hagan, ClearBank’s chief risk and compliance officer, said that since the 2008 financial crisis the number of options for parking money has expanded, “be it central bank, digital currencies or stablecoins, or just traditional services that aren’t exposed to the traditional banking-type risks.”
ClearBank’s client base includes 200 regulated financial institutions, which use its technology to clear transactions and process payments.