U.S. bank stocks recover after falling amid SVB collapse
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Shares of California-based First Republic Bank rose sharply on Tuesday as concerns about the health of the regional bank eased after a day of heavy selling that had plunged more than 61% the day before.
It is reported CNBC.
Shares of First Republic rose 36% on the session, PacWest jumped 44%, while KeyCorp gained 11% and Western Alliance – 20%.
First Republic shares fell 61.8% on Monday. Executive Chairman Jim Herbert told CNBC that the bank is not seeing large outflows and is operating as usual. The bank also announced on Sunday that it had received additional liquidity from JPMorgan and the Federal Reserve.
“Confident statements from financial leaders seemed to help support growth on Tuesday,” the newspaper noted.
Charles Schwab CEO Walt Bettinger told CNBC that the company is seeing inflows in “significant numbers.” Meanwhile, KeyCorp CEO Chris Gorman said his bank has not seen significant deposit outflows in recent days and is actually receiving cash inflows from retail customers.
However, First Republic shares rose to intraday highs after S&P Global revised the bank’s credit rating to negative, citing volatility in deposit flows.
In addition to supporting deposits at SVB and Signature Bank, which were closed on Sunday, federal regulators also announced efforts to stabilize the broader banking system.
One of them is the Fed’s Bank Refinancing Program, which will allow banks to exchange certain high-quality assets for cash without reserving losses at market prices.
The rise came despite Moody’s Investors Service downgrading its outlook on the US banking system from stable to negative.
We remind you:
Monday The US guaranteed the preservation of SVB bank deposits, but these actions could not reassure investors about the situation of other banks around the world: shares of leading banks fell down.
Silicon Valley Bank pond the largest U.S. bankruptcy in a decade, after its longtime customer base of tech startups became concerned and began withdrawing deposits.
American regulator close Signature Bank, a major lender in the crypto industry, in an attempt to contain the spread of the banking crisis.
US Federal Reserve System will provide additional funding to help the banking system function after the collapse of Silicon Valley Bank and Signature Bank.
US President Joe Biden made an emergency appeal against the background of the banking crisis in the USA and assured citizens that the banking system is safe.
Read also: The world is panicking over the collapse of Silicon Valley Bank and fears a new financial crisis. Is everything so serious?
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