The Financial Times reported on Tuesday that the Bank of England is considering strategies to compel more foreign banks to establish subsidiaries in the UK.
The newspaper reported, citing persons knowledgeable, that the BOE is taking the proposal under consideration as part of an investigation into the collapse of the American bank Silicon Valley Bank earlier this year.
According to the newspaper, the action could lower the thresholds required for international banks with corporate operations in the nation to set up subsidiaries. It was mentioned that local regulators may more easily seize control of subsidiaries, like SVBs in London, in the event of failure.
The BOE will consider the threshold for a foreign bank branch to become a subsidiary, according to Nathanael Benjamin, executive director for authorizations and international banks.
In order to avoid upsetting its British clients after the demise of its parent firm in the United States, Silicon Valley Bank’s UK division was sold to HSBC in March.
A request for feedback from the Bank of England did not receive a prompt response.
