The Department of Finance has said it is monitoring developments regarding the collapse of Silicon Valley Bank and that it is engaging with the relevant authorities.
"While there is limited direct impact on the Irish financial system, Silicon Valley Bank was a lender to some Irish companies since 2012," the department said in a statement.
"The department will monitor the progress of the Federal Deposit Insurance Corporation (FDIC), the US Government agency that guarantees bank deposits, in its sale of SVB and what impact that may have on domestic companies impacted by this failure," it added.
Silicon Valley Bank was closed by US regulators on Friday following a run on deposits amid a collapse of its share price.
In 2019, SVB announced plans to increase its lending to Irish tech start-ups to $500m as part of a collaboration with the Ireland Strategic Investment Fund (ISIF).
ISIF said it has around $100m invested in five investment funds that are managed by SVB Capital, a subsidiary of the Silicon Valley Bank Group.
However, it said that those investments are structured in a manner that legally ring-fences them from the rest of the SVB Financial Group and it does not expect any impact.
"Certainly, Silicon Valley Bank was an important bank for this sector, there's no doubt about that," said Brian Fennelly, a Partner in Deloitte's Debt & Capital Advisory team.
He estimated it had "upwards of 100 plus borrowers" in Ireland.
Chief Executive of cosmetic treatment chain Sisu Clinic, Pat Phelan, said his company had millions on deposit with SVB and withdrew all but an insured sum of $250,000 hours before the bank collapse, amid concerns over its plummeting share price.
"We're a venture backed start-up, the venture capitalists like you to use SVB," explained Mr Phelan, describing SVB as "the start-up bank" that was "entrenched into that ecosystem".
"I suppose the worst part of it was getting calls from people yesterday," he added.
"I was talking to one person in particular who runs a very successful Irish company and has eight million that they have no access to today."
"I think certainly there are a huge amount of start-ups going to get stung," he added.
The Managing Director of Ireland's national start-up accelerator programme, NDRC, said that a small number of companies it is working with "have been directly affected by the SVB meltdown".
Ian Browne wrote in a LinkedIn post that it was not a time to panic and that NDRC would continue to support those affected.
"It will however require time to sort out," Mr Browne wrote.
"This will mean cashflow difficulties for those affected and the inability to pay staff and suppliers. Frozen accounts will remain frozen for a period of time."
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Irish companies caught up in 'SVB meltdown'
In Britain, Chancellor Jeremy Hunt said he was working with Prime Minister Rishi Sunak and Bank of England Governor Andrew Bailey to "avoid or minimise damage" resulting from the chaos engulfing the UK arm of Silicon Valley Bank.
Given the importance of the bank to some customers, its collapse could have a significant impact on British technology companies, Mr Hunt said.
"We've been working at pace over the weekend, through the night," Mr Hunt told Sky News.
"We will bring forward very soon plans to make sure people are able to meet their cashflow requirements to pay their staff."
Mr Hunt said efforts are focused on finding a "longer-term solution that minimises, or even avoids completely, losses to some of our most promising companies".
Advisory firm Rothschild & Co is exploring options for the UK arm, called Silicon Valley Bank UK Limited, as insolvency looms, two people familiar with the discussions told Reuters.
The Bank of England has said that it is seeking a court order to place the UK arm into an insolvency procedure.
Lenders including Barclays PLC and Lloyds Banking Group are among parties to have been approached by the board of SVB UK over the weekend to see if an emergency takeover deal can be reached, Sky News reported.
Bank of London, a clearing bank, is weighing whether an offer is possible, a person with knowledge of the discussions told Reuters.
SVB Group declined a Reuters request for comment while Barclays and Lloyds Banking did not immediately respond.
More than 250 UK tech firm executives signed a letter addressed to Mr Hunt on Saturday calling for government intervention and warned of an "existential threat" to the UK tech sector, a copy seen by Reuters shows.
Under insolvency proceedings for banks in Britain, some depositors are eligible for up to £85,000 of compensation for cash held at lenders, or £170,000 pounds for joint accounts.
Customers may not be able to recover deposits in excess of those sums, which are small relative to the deposits some start-ups had with the bank.
Mr Hunt reiterated comments by the Bank of England that overall, Silicon Valley Bank had a limited presence in Britain and did not perform functions critical to the financial system.
Additional reporting Samantha Libreri and Reuters
