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The British arm of Silicon Valley Bank (SVB UK) has handed out millions of pounds in employee bonuses just days after its insolvency was averted through a Bank of England-orchestrated rescue deal.

Sky News has learnt that the payouts to staff including its senior executives were signed off by HSBC, SVB UK’s new owner, earlier this week.

Sources described the bonus pool as “modest”, and said it totalled between £15m and £20m.

It was unclear on Saturday how much had been awarded to Erin Platts, the UK bank’s chief executive or her senior colleagues.

One insider said the bonus payments were a signal of HSBC’s confidence in the talent base at its new subsidiary and that the buyer had been keen to honour previously agreed payments in order to help retain key staff.

Employing about 700 people in Britain, SVB UK is a profitable business but was brought to the brink of collapse last weekend by the travails of its American parent company.

Had it not been acquired solvently, the bonuses would not have been paid this week, according to insiders.

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One pointed out that stock held by senior executives and other employees had been rendered worthless by SVB UK’s near-collapse.

In the US, its banking arm has been taken into government ownership and its holding company, SVB Financial Group, has now filed for Chapter 11 bankruptcy protection as it seeks buyers for its other assets.

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Bonuses were also paid to its US staff just hours before the Santa Clara-based bank collapsed, according to reports last week.

An emergency auction in which Rishi Sunak, the prime minister, played a pivotal role drew interest from challenger banks including Oaknorth and The Bank of London.

HSBC, Europe’s biggest lender, struck a deal before markets opened in London on Monday to buy SVB UK for £1.

It was given a waiver from bank ring-fencing rules introduced after the 2008 financial crisis.

Jeremy Hunt, the chancellor, said the rescue had been critical to preserving funding to some of the UK’s most promising start-up companies.

“The UK’s tech sector is genuinely world-leading and of huge importance to the British economy, supporting hundreds of thousands of jobs,” he said.

“We have worked urgently to deliver on that promise and find a solution that will provide SVB UK’s customers with confidence.

“[This] ensures customer deposits are protected and can bank as normal, with no taxpayer support.”

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Silicon Valley Bank – what happened?

The government had been lobbied intensively last weekend by hundreds of tech entrepreneurs about the parlous state of SVB UK.

They warned of “an existential threat to the UK tech sector”, adding: “The Bank of England’s assessment that SVB going into administration would have limited impact on the UK economy displays a dangerous lack of understanding of the sector and the role it plays in the wider economy, both today and in the future.”

The founders warned Mr Hunt that the collapse of SVB UK would “cripple the sector and set the ecosystem back 20 years”.

“Many businesses will be sent into involuntary liquidation overnight,” they wrote.

Sky News revealed this week that Ms Platts, who has worked in the lender’s British operations since 2007, would remain in her job following talks with Ian Stuart, the HSBC UK chief executive.

SVB UK’s independent directors, who include chairman Darren Pope, are also expected to stay on under HSBC’s ownership.

That indicates HSBC’s intention to enable the technology-focused lender to operate with some degree of autonomy on an ongoing basis.

However, the Silicon Valley Bank brand may disappear in the UK, depending upon its fate in the US, one insider said.

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The turmoil at SVB has threatened to escalate into a much broader banking crisis, with the Financial Times reporting on Friday evening that UBS is in talks to take over part or all of its Zurich-based peer, Credit Suisse.

In the US, a group of large lenders including Bank of American and JP Morgan provided a $30bn deposit lifeline to First Republic on Thursday.

However, its shares continued to slump on Friday, raising renewed fears for its health.

A spokesman for SVB UK declined to comment on the bonus payments handed out this week.

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Horizon scandal: More than £1m claimed as Post Office ‘profit’ may have come from sub-postmasters

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Horizon scandal: More than £1m claimed as Post Office 'profit' may have come from sub-postmasters

More than £1m of unexplained transactions were transferred in to Post Office profit at the height of the Horizon scandal, leaked documents have showed.

The papers seen by Sky News show a snapshot of transfers from a Post Office “miscellaneous client” suspense account over a four year period, up to 2014.

A suspense account is where unexplained, or disputed, transactions remain until they are able to be “reconciled”.

Unaccounted-for transactions were transferred out of the Post Office suspense account and into their Profit and Loss account after three years.

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Ian Henderson, director of Second Sight – the forensic accountants hired years ago by Post Office – said: “The Post Office was not printing money. It was accumulating funds in its suspense account.

“Those funds belong to somebody, either to third party clients or to sub-postmasters, and part of the work we were doing in 2015 was drilling into that.”

Mr Henderson said they were sacked not long after asking questions about whether Post Office profited from shortfalls paid for by sub-postmasters.

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Mr Henderson told Sky News that the money could potentially have come from sub-postmasters’ pockets

More than 900 sub-postmasters were wrongly prosecuted due to faults with Horizon accounting software.

A letter from Alisdair Cameron, the Post Office’s chief financial officer, to Second Sight in February 2015 states some “postings cannot be traced” to “underlying transactions”.

He added: “We are not always able to drill back from the combined totals to itemise all the underlying transactions.”

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‘Compensation paid by summer’

Mr Henderson said the letter shows that “the Post Office was benefiting from this uncertainty due to, frankly, bad record keeping, but taking it to the benefit of their Profit and Loss account.”

He maintains that it’s impossible to prove for sure that sub-postmasters’ money went into Post Office profit because of a “lack of granularity”.

He says therefore that it is of “sufficient public interest” that a further independent review into the use of suspense accounts should happen.

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Mr Henderson added: “It didn’t come from thin air, where did the money come from? That’s a fundamental question Post Office have not answered.”

Meanwhile, separately, a secret recording obtained by Sky News indicates that Post Office was trying to gag the independent forensic accountants.

The recording is of a meeting in January 2014 between Second Sight, a lawyer and a Post Office representative.

It took place over a year before the accountants were sacked.

In the conference call there are signs the relationship between Post Office and Second Sight was beginning to weaken.

There is discussion about a contractual confidentiality agreement, a “Letter of Engagement” between the parties.

In the recording Ian Henderson says: “Either, you know, we have unfettered discretion and authorisation to just talk to MPs or we haven’t.

“At the moment, the way the document is drafted, we are prevented from doing that. That’s the issue.”

His colleague at Second Sight, Ron Warmington is heard agreeing.

In another part of the recording there are more concerns raised that the investigators are being blocked from talking to MPs.

Mr Henderson says: “My point is we should not be gagging either the applicant or Second Sight in being able to respond, you know, fully and frankly to MPs who frankly sort of set this whole process in motion.”

The Post Office representative replies saying they’re not trying to gag anybody.

Mr Henderson describes “a point of principle”: “In exactly the same way that when we were doing spot reviews, we disclosed to MPs, when they asked us a specific question, the information provided to us by Fujitsu and by Post Office.

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“And that’s why it’s so important to establish this principle that there should be no gagging of Second Sight in relation to being able to discuss our investigative work with MPs.”

In the same meeting his colleague Ron Warmington said that if it later emerges that Second Sight have been “effectively gagged” in its dealing with MPs, “it’s not going to be Second Sight they are particularly annoyed with, it’s going to be Post Office.”

The representative responds directly with: “I think that’s something that the Post Office will have to deal with if – if it arises.”

Adding that “some of the terminology in terms of gagging is probably an exaggeration of what it is that is trying to be done here, and at the moment you haven’t signed anything.”

Post Office released a statement in response to the findings: “The statutory public inquiry, chaired by a judge with the power to question witnesses under oath, is the best forum to examine the issues raised by this evidence.

“We continue to remain fully focused on supporting the inquiry get to the truth of what happened and accountability for that.”

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Millions urged to read energy meters this weekend to avoid overpaying as price cap falls again

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Millions urged to read energy meters this weekend to avoid overpaying as price cap falls again

Millions of people are being urged to send meter readings to their energy supplier this weekend to ensure they don’t overpay.

The regulator’s price cap drops 12.3% on Monday 1 April, from a typical £1,928 per year for a dual-fuel household to £1,690 – an average saving of about £20 per month.

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People without a smart meter who are on a standard variable tariff (SVT) should send readings so their company has an up-to-date record when the prices change.

“If you delay submitting your readings, some of your energy usage could end up being charged under the higher rates we’re currently facing,” said Ben Gallizzi, energy spokesman for comparison site Uswitch.

This could happen as firms will estimate usage if they don’t have recent readings.

However, if you have a smart meter you shouldn’t have to worry as it’s set up to automatically ensure you are billed correctly.

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Uswitch says a week of energy at the current rates is £4.65 more expensive for the average household than the incoming rates.

About 10 million customers are thought to be on a SVT without a smart meter.

The combination of the cheaper rates and warmer weather is estimated to mean the average household will spend £127 on gas and electricity in April, compared with £205 in March.

Nearly a fifth of people without a smart meter have not submitted a reading in the last three months and 4% haven’t done it for a year, according to a Uswitch survey of 2,000 people.

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Twelve percent of these customers said they didn’t know where their meter was, while 14% didn’t know how to take a reading.

People without a smart meter are advised to read their meter every month to improve the accuracy of their bills.

The price cap is set by energy regulator Ofgem and is being cut again from the extreme highs of recent years – when it reached over £4,000 – thanks to a drop in wholesale prices,

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Ofgem also launched a consultation on the energy price cap this week, floating options such as a cap based on vulnerability and when energy is used.

The cap, which affects England, Scotland and Wales, was introduced in January 2019 to prevent people on variable tariffs being ripped off.

Initially it was changed a couple of times a year but since 2022 it has been updated every three months.

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‘Modest’ £63 rise in statutory sick pay is overdue, MPs say

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'Modest' £63 rise in statutory sick pay is overdue, MPs say

A “modest” increase in statutory sick pay (SSP) is overdue, according to a committee of MPs who say it must strike a balance between workers’ needs and what employers can afford.

The Work and Pensions Committee recommended a rate in line with the flat rate of Statutory Maternity Pay.

That would see SSP rise from the current weekly level of £109.40 to £172.48 per week.

The MPs also wanted to see SSP paid in combination with usual wages, in order to encourage phased returns to work.

The cross-party committee argued too that all workers should be eligible for SSP, not just those earning above the lower earnings limit of £123.

The government responded to the report by saying that a 6.7% increase would take effect next month.

In making their case, the MPs said they understood that the COVID pandemic and its immediate aftermath were not the right times to be placing additional financial burdens on employers.

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But they noted that a record 185.6 million working days had been lost to sickness or injury in 2022 – a time when the cost of living crisis was gathering pace.

Committee chair Sir Stephen Timms said it was clear the time had come to significantly bolster the support that many people depended on when they were unable to work.

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“Statutory sick pay is failing in its primary purpose to act as a safety net for workers who most need financial help during illness,” he wrote.

“With the country continuing to face high rates of sickness absence, the government can no longer afford to keep kicking the can down the road on reform.

“The committee’s proposals strike the right balance between widening and strengthening support and not placing excessive burdens on business.

“A growing number of workers are now classified as self-employed and a new contributory sick pay scheme for self-employed people would be a welcome step towards ensuring they are they are no worse off financially during periods of sickness than employees on SSP.”

Companies, while sympathising with staff generally over sickness, have long complained about rising costs including for business rates and minimum pay rules.

Lobby groups have warned that the burden already risks being passed on in the form of higher prices, placing the rate of inflation under strain.

A Department for Work and Pensions spokesperson said of the report: “Statutory Sick Pay will increase by 6.7% from April.

“Our £2.5bn Back to Work Plan is tackling sickness absence and getting people back working, while we are expanding access to mental health services and supporting those at risk of long-term unemployment.”

TUC general secretary Paul Nowak responded: “The COVID-19 pandemic showed that our sick pay system is in desperate need of reform.

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“It beggars belief that ministers have done nothing to fix sick pay since.

“It’s a disgrace that so many low-paid and insecure workers up and down the country – most of them women – have to go without financial support when sick.

“The committee is right that ministers urgently need to remove the lower earnings limit and raise the rate of sick pay.

“Wider reform is also needed to remove the three days people must wait before they get any sick pay at all.”

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