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Silicon Valley Bank’s collapse has posed an issue for Chinese funds and tech start-ups using the bank as a funding bridge for groups operating between China and the United States.
According to the Financial Times, SVB’s sudden takeover by the US banking regulators on Friday left executives in China with little time to get their money back, with many now saying that their funds are tied up.
The Silicon Valley-based lender served a key role in China’s dollar-based ecosystem for funding start-up companies, industry insiders told the outlet, with these companies and funds often holding their money at SVB as an intermediary before bringing it to China.
“We tried Friday morning, but it was already too late. The transfer is still processing,” the founder of a Beijing-based tech company with about $10mn currently in limbo told the Financial Times. “It’s very crazy, we didn’t think this could happen.”
The anonymous founder hopes that a large American bank would take over SVB’s US assets. The founder noted that since half of their capital was held at a separate bank onshore in yuan they didn’t foresee any payment issues in the near future.
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