SVB, Signature Bank collapse: Will it affect startups in the UAE?

SVB, Signature Bank collapse: Will it affect startups in the UAE?

Experts do not not rule out the possibility of entities in the UAE’s tech sector having some exposure to SVB

Published: Tue 14 Mar 2023, 2:18 PM Last updated: Tue 14 Mar 2023, 2:53 PM

The abrupt and unexpected collapse of Silicon Valley Bank (SVB) and Signature Bank in the US has sent shockwaves through global markets. However, its impact on the UAE is minimal, experts have said.

“Most businessmen in the region viewed it as lucrative business opportunity … Bankers are perceiving SVB’s collapse as an opportunity to bail out cash-strapped startups and tech entities. That being said, the immediate ripple effect of the news was felt in the UAE, too, as shares of banks traded lower,” said Vijay Valecha, chief investment officer at Century Financial.

SVB Financial Group became the largest bank to fail since the 2008 financial crisis on Friday, roiling markets around the world.

Valecha stressed that the UAE has developed several policies and initiatives to actively support the startup ecosystem within the country.

Vijay Valecha, CIO at Century Financial

“The government has made funding and financial support accessible through (various) programmes … Most importantly, the government has created a business-friendly regulatory environment that offers exemptions and incentives to startups that may be