SYDNEY (Reuters) -Several Australian and New Zealand tech firms said on Monday they did not have material exposure to Silicon Valley Bank following the failure of the U.S. startup-focused lender SVB Financial Group last week.
Australian Treasurer Jim Chalmers said the government was aware some Australian firms have been impacted but added the country’s “institutions are solid (and) our banking sector is well-capitalised.”
“We are closely monitoring the situation and potential impacts for Australia,” Chalmers said in a statement.
Australia’s banking regulator said it had intensified the supervision of the local banking industry and was seeking more information from banks on any potential impact.
Nitro Software said about $12.2 million of its global cash reserves were held on deposit at SVB and that recent events do not impact private equity firm Potentia Capital’s A$532.3 million ($353 million) takeover offer.
U.S.-based Sezzle said the buy now, pay later firm’s relationship with SVB was only limited to funds on deposit, while Siteminder said its exposure consisted of up to A$10 million cash holdings and an undrawn $20 million revolving credit facility.
Australian design technology firm Canva said the majority of its cash was outside SVB and that it had “safety nets in place” to ensure its operations were not compromised.
Most Australian startups should be insulated from the direct impact, says Paul Bassat, co-founder of Australian venture capital fund Square Peg, which has stakes in roughly 60 companies in Australia, the U.S. and Asia.
In New Zealand, cloud-based accounting software company Xero said it does not expect any adverse impact.
Friday’s failure of SVB Financial Group, which focuses on technology startups, was the biggest bank collapse in the United States since the 2008 financial crisis.
On Sunday, state regulators closed New York-based Signature Bank, the second bank failure in two days, as the U.S. Treasury and Federal Reserve unveiled a range of measures to stabilise the banking system.
($1 = 1.5101 Australian dollars)
(Reporting by Upasana Singh in Bengaluru and Praveen Menon, Lewis Jackson and Renju Jose in Sydney; Editing by Kim Coghill and Edwina Gibbs)