Stock markets in the US and across the globe continue to be under pressure after the Silicon Valley Bank collapse, even as US President Joe Biden tried to reassure investors. Another American lender Singature Bank has shut shop within days of SVB and bank stocks in Europe also slipped 6.2 per cent, after HSBC rescued SVB in the UK. Now another US lender First Republic Bank has crashed 65 per cent, despite assurances about its liquidity and an infusion from JP Morgan.
Investors aren't convinced
Despite access to $70 billion and more under a US aid program, First Republic hasn't been able to soothe investor anxiety after being downgraded. Raymond James had moved the lender down from Strong Buy status to Market Performance, over the risk of clients withdrawing their funds enmasse from First Republic, after the SVB crash. Another rating agency Wolfe Research, cut their outlook from peer-perform to outperform.
Has the crisis been contained?
Another American lender Western Alliance Bancorp suffered a worse slump, as its shares dropped by 75 per cent on fears of contagion. Outside the US, European bank Credit Suisse crashed by more than 10 per cent, to record lows, because of the SVN collapse. The latest crisis comes as an additional blow for the Swiss bank which had already shed 70 per cent stock value in 2022.
(To receive our E-paper on WhatsApp daily, please click here. To receive it on Telegram, please click here. We permit sharing of the paper's PDF on WhatsApp and other social media platforms.)
