Confidence in banking is hard-earned and easily shocked. This makes individual banks and the banking sector susceptible to knock-on effects from other institutions.
A real payload.
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The failure of Silicon Valley Bank has raised questions about some of the consequences when the government steps in to protect the depositors of troubled banks.
Big interest rate hikes could cause more market turmoil, while doing too little could have the same effect.
Outside Signature Bank headquarters in New York City. Regulators closed the bank on March 12, 2023.
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The recent collapse of three banks has lawmakers debating whether stricter regulations will prevent other banks from meeting the same fate.
Silicon Valley Bank, the sixteenth-largest bank in the U.S., collapsed on March 10, 2023 after customers tried to collectively withdraw $42 billion in a single day.
(AP Photo/Jeff Chiu)
The collapse of Silicon Valley Bank serves as a reminder of the importance of robust risk management, sound regulatory oversight and effective liquidity management.
Not for turning: ECB President Christine Lagarde.
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The banking crisis has been caused by the interest rate rises, and further hikes were supposed to be a no no.
The U.S. Federal Deposit Insurance Corporation seized the assets of Silicon Valley Bank on March 10, 2023, marking the largest bank failure since Washington Mutual during the height of the 2008 financial crisis.
(AP Photo/Jeff Chiu)
The Fed, Treasury and FDIC acted swiftly to protect depositors and stem any panic, but anxiety continues to grow about the state of the global financial system.
Fed Chair Jerome Powell has a tricky job in balancing inflation fears with recession fears.
AP Photo/Jose Luis Magana
The latest consumer prices report shows cost of living is still rising far above the Fed’s target. But don’t expect monetary policymakers to aggressively hike rates.
Signature Bank collapsed at lightning speed.
AP Photo/Yuki Iwamura
Lenders face a lot of risks, but two of them – interest rate and liquidity – were the main drivers of the sudden and rapid failure of Silicon Valley Bank and Signature Bank. That’s why more trouble may be ahead for the banking sector.