Losses in global bank shares deepen as fans of SVB’s collapse deepen crisis fears | – #Losses #global #bank #shares #deepen #fans #SVBs #collapse #deepen #crisis #fears

March 14 (Reuters) – Shock waves from the collapse of Silicon Valley Bank ( SIVB.O ) sent global shock waves on Tuesday bank further undermined its stock because the president Cho Biden and assurances from other policymakers did little to calm markets and prompt a revision of interest rate views.

Biden’s efforts to reassure markets and depositors USAIt comes after investors were unable to allay concerns about the possibility of contagion to other lenders around the world after emergency measures introduced by the US to bolster banks by providing them with extra funding.

Major Australian banks ANZ ( ANZ.AX ), Westpac ( WBC.AX ) and NAB ( NAB.AX ) were up more than 2%, while Japan’s bank sub-index (.IBNKS.T) fell by 6.7% in Asia bank reserves continued to decline. fell to its lowest level since December in early trade.

A furious race to reassess interest rate expectations also sent ripples through markets as investors believed the Federal Reserve would refrain from raising next week.

Paul Ashworth, chief economist for North America at Capital Economics, said, “Even if the collapse of a few mid-tier banks does not turn into a full-blown systemic crisis, it is likely to credit will cause a crisis,” he said.

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Traders currently see a 50% chance of no rate hike at that meeting, with rate cuts expected for the second half of the year. At the beginning of last week, a 25 basis point increase was priced in exactly, and a 70% chance was seen at 50 basis points.

With investors fearing further setbacks USAThe main banks of the stock market on Monday about 90 billion dollars losing nearly 190 in the last three trading sessions billion delivered to the dollar.

USAThe regional banks suffered the most damage. Shares of First Republic Bank ( FRC.N ) fell more than 60% as fresh financing news failed to reassure investors, as did Western Alliance Bancorp ( WAL.N ) and PacWest Bancorp ( PACW.O ).

Europe’s STOXX bank index (.SX7P) closed 5.7% lower. Germany’s Commerzbank ( CBKG.DE ) fell 12.7%, while Credit Suisse ( CSGN.S ) fell 9.6% to record lows.

Bidensaid his administration’s actions mean “Americans can rest assured that the banking system is safe,” at the same time 20He promised tougher regulation after the biggest US bank failure since the 2008 financial crisis.

“Your savings will be there when you need them,” he said.

Reuters Graphics Reuters Graphics Access to deposits

SVB customers will have access to all their deposits from Monday, and regulators have set up a new facility to give banks access to emergency funds. The Fed made it easier for banks to borrow from it in an emergency.

US bank regulators lined up outside SVB’s Santa Clara, Calif., headquarters on Monday for coffee and donuts offer They tried to calm down the angry customers.

FDIC official Luis Mayorga told waiting customers, “Please feel free to conduct business as usual. We just want some time because of the volume,” he said.

Regulators also moved quickly to shut down New York Signature Bank SBNY.O, which has come under pressure in recent days.

Mark Sobel, a former senior Treasury official and chairman of the Forum of U.S. Official Monetary and Financial Institutions, a think tank, said: “There needs to be a serious investigation into why regulators missed red flags … and what needs to be revised.”

Reuters GraphicsFALLOUT

Money markets in the US and Eurozone banking systems credit risk indicators have increased.

Emboldened by bets the Fed may have to slow rate hikes, the price of gold, a popular safe-haven key 1,900 dollars competed above his level.

Companies around the world with SVB accounts were quick to assess the impact on their finances. in Germany central bank convened a crisis team to assess any outcome.

HSBC HSBA.L SVB’s after a marathon weekend of talks Britain arm to a pound (1.21 dollars) said he bought.

Although SVB UK was small, its sudden demise prompted calls for government help for Britain’s start-up industry, and in particular its biotech sector.

UK Prime Minister Rishi Sunak said there was no concern about systemic risk.

“Our banks are well capitalized, liquidity is strong,” Sunak told ITV during his visit to the United States.

In China, where SVB is the main foreign bank most startups turn to, entrepreneurs and venture funds have also struggled for alternative financing.

Reporting by Trevor Hunnicutt in Washington, Alun John in London and Rae Wee in Singapore Additional reporting by Heather Timmons, Pete Schroeder, Andrea Shalal, Ashraf Fahim and Julio-Cesar Chavez in Washington, Jonathan Stempel in New York, Noel Randewich in Oakland, California; Valentina Za in Milan and Amanda Cooper, Dhara Ranasinghe and Lucy Raitano in London Writing from the Lincoln Banquet Editing by Anna Driver and Sam Holmes

Our standards: Thomson Reuters Trust Principles.

2023-03-14 05:37:41
Source – reuters

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