HSBC has struck a last-minute deal to buy the collapsed Silicon Valley Bank UK, averting a crisis that threatened chaos across Britain’s tech sector.

The British bank will buy SVB UK’s business for £1 after talks over the weekend between lenders, the Treasury and start-up representatives.

The bank had loans of around £5.5bn and deposits of around £6.7bn, and made an £88m profit last year.

“The Bank of England, in consultation with the Prudential Regulation Authority, HM Treasury and the Financial Conduct Authority, has taken the decision to sell Silicon Valley Bank UK Limited, the UK subsidiary of the US bank, to HSBC UK Bank Plc,” it said.

“This action has been taken to stabilise SVB UK, ensuring the continuity of banking services, minimising disruption to the UK technology sector and supporting confidence in the financial system.

“The Bank and HMT can confirm that all depositors’ money with SVB UK is safe and secure as a result of this transaction. SVB UK’s business will continue to be operated normally by SVB UK. All services will continue to operate as normal and customers should not notice any changes.”

SVB UK collapsed over the weekend, with the Bank of England seizing control of the lender, after a bank run on its US branch made it unviable.

The failure threatened thousands of British tech companies and investors who rely on the start-up-focused SVB UK as their bank of choice.

Mr Hunt and Treasury officials had been holding crunch talks with the industry over the weekend and seeking to find a buyer, with HSBC, Barclays, Bank of London and Oaknorth among the potential bidders. Sources suggested HSBC was seen as the most stable and secure candidate.

Putting the bank into insolvency without a buyer meant start-ups were threatened with having their deposits frozen, potentially making them unable to pay staff or suppliers.

Jeremy Hunt, the Chancellor, said: “The UK’s tech sector is genuinely world-leading and of huge importance to the British economy, supporting hundreds of thousands of jobs. I said yesterday that we would look after our tech sector, and we have worked urgently to deliver on that promise and find a solution that will provide SVB UK’s customers with confidence.

“Today the Government and the Bank of England have facilitated a private sale of Silicon Valley Bank UK; this ensures customer deposits are protected and can bank as normal, with no taxpayer support. I am pleased we have reached a resolution in such short order.

“HSBC is Europe’s largest bank, and SVB UK customers should feel reassured by the strength, safety and security that brings them.”

Noel Quinn, HSBC’s chief executive, said, “This acquisition makes excellent strategic sense for our business in the UK. It strengthens our commercial banking franchise and enhances our ability to serve innovative and fast-growing firms, including in the technology and life-science sectors, in the UK and internationally.

“We welcome SVB UK’s customers to HSBC and look forward to helping them grow in the UK and around the world. SVB UK customers can continue to bank as usual, safe in the knowledge that their deposits are backed by the strength, safety and security of HSBC. We warmly welcome SVB UK colleagues to HSBC, we are excited to start working with them.”