HSBC has stepped in to rescue the UK division of Silicon Valley Bank (SVB), which had collapsed in the US, providing relief to UK tech firms that were in danger of going bankrupt without assistance.

Depositors and businesses with funds held in SVB UK will be able to access them and other banking services as usual, with the Treasury affirming that no taxpayer funds were involved and the Bank of England stating that deposits were secure.

Following the failure of SVB on Friday, HSBC paid just £1 to acquire its UK arm. The failure of SVB, which specialised in lending to technology firms, sent shockwaves through the sector over concerns about the potential impact on businesses, with some warning of possible bankruptcy if deposits were not secured.

Nonetheless, HSBC Group Chief Executive Noel Quinn reassured SVB UK customers that their deposits would remain safe. Chancellor Jeremy Hunt and the Bank of England governor worked throughout the weekend to develop a solution.

Although the UK arm of SVB had only around 3,000 business customers, its collapse would have presented a risk for a sector that the government sees as key to the country’s future economic success.

The Bank of England also confirmed that no other UK banks had been significantly impacted by the collapse and that the wider banking system remained sound, secure, and well-capitalised.

Mr Hunt said such firms were often “fragile”.

“Some of them only had bank accounts with SVB UK and so for that reason we were faced with a situation where could have seen some of our most important companies, our most strategic companies, wiped out and that would have been extremely dangerous,” he said.

On Sunday, the US Federal Reserve and Federal Deposit Insurance Corporation (FDIC) confirmed that depositors in the US would be fully safeguarded, paving the way for HSBC’s acquisition of SVB’s UK division.

SVB’s failure in the US on Friday was due to its inability to raise $2.25bn (£1.9bn) to offset losses incurred from selling assets, mainly US government bonds, that had been affected by rising interest rates.

The bank’s troubles triggered a rush of withdrawals in the US and raised concerns throughout the wider banking industry, with over 200 leaders of UK tech companies signing a letter to Chancellor Jeremy Hunt urging the government to intervene.