BBC (April 24)
In the bank’s final quarterly results, Credit Swiss disclosed that nearly $69 billion was withdrawn by depositors during the first three months of 2023. Coming on the heels of a gaping loss in 2022 and forecast loss for 2023, the deposit withdrawal was part of the impetus behind “its forced sale to rival Swiss bank UBS.” The sale has “has angered taxpayers and shareholders of both banks, who were deprived of a vote on the takeover. Some have also argued it has damaged Switzerland’s global reputation as a financial centre.”
Tags: 2023, Banks, Credit Swiss, Damaged, Deposit, Depositors, Forecast, Loss, Quarterly results, Reputation, Shareholders, Switzerland, Takeover, Taxpayers, UBS, Withdrawn
American Banker (March 27)
“Silicon Valley Bank was not the only institution that loaded up on bonds at precisely the wrong time. Based analyzing the regulatory filings of over 4,700 U.S. banks, “dozens of other banks — most of them quite small — are deeply underwater on their bond investments and could hit trouble if they were unexpectedly forced to liquidate the investments.” Still, “many experts say there is very little risk that those unrealized losses could ever turn into a problem, given the many options available to banks and regulators’ focus on avoiding that type of scenario.”
Tags: Banks, Bonds, Experts, Forced, Investments, Liquidate, Regulators, Regulatory filings, Risk, SVB, U.S., Underwater, Unrealized losses, Wrong time
Wall Street Journal (March 13)
“For the second time in 15 years (excluding the brief Covid-caused panic), regulators will have encouraged a credit mania, and then failed to foresee the financial panic when the easy money stopped.” Other banks may be exposed to the duration risk that brought down Silicon Valley Bank (SVB), “as last week’s selloff in regional bank stocks shows…. Something like 85% to 90% of SVB’s deposits are uninsured. The worry is that depositors in other banks will now flee.”
Tags: 15 years, Banks, Covid, Credit mania, Deposits, Duration risk, Easy money, Exposed, Financial panic, Regulators, Selloff, Silicon Valley Bank, Uninsured
American Banker (January 26)
“The Federal Reserve may be slowing down on rate increases, but the same isn’t true for your neighborhood bank. Almost 20% of U.S. banks offered to pay savings rates of 2% or more in January, up from 15% in December and from just 1% a year ago.”
Tags: 2%, Banks, Fed, Rate increases, Savings rates, U.S., Up
Wall Street Journal (January 22)
“The rash of failures showed how interconnected the crypto lenders were, allowing market shocks to ripple through one lender to the next.” Though they essentially “have the same business model as banks,” crypto lenders lack the regulatory protections and failsafe measures, which ensure “small depositors are kept whole in the case of a bank failure.”
Tags: Banks, Business model, Crypto lenders, Depositors, Failsafe, Failures, Interconnected, Market shocks, Rash, Regulatory protections, Ripple
American Banker (December 9)
“Fintechs turned cross-border payments into a hotbed of innovation over the last five years. Now the card networks and banks are responding with disruptions of their own. It’s not just the competitive threat from fintechs developing faster, cheaper and more transparent cross-border payment options. The changing economy is now adding urgency for legacy cross-border providers to modernize their services.”
Tags: Banks, Card networks, Cheaper, Competitive threat, Cross-border, Disruptions, Economy, Faster, Fintechs, Hotbed, Innovation, Legacy, Modernize, Payments, Services, Transparent
American Banker (November 9)
“Lenders made it harder in the third quarter for both consumers and businesses to access credit,” and this trend looks likely to continue. “If the U.S. economy falls into a recession, more than 80% of banks said they would ‘somewhat’ or ‘substantially’ tighten lending standards for credit cards and loans backed by commercial real estate. More than 70% of banks said they would do the same for auto, commercial and industrial and residential real estate loans.”
Tags: Access, Auto, Banks, Businesses, Commercial, Consumers, Credit, Credit cards, Economy, Industrial, Lenders, Lending standards, Loans, Real estate, Recession, Tighten, U.S.
Washington Post (October 9)
“Quantum research still has plenty of obstacles to overcome before it reaches widespread use. But banks, health-care companies and others are starting to run experiments on the quantum internet. Some industries are also tinkering with early-stage quantum computers to see whether they might eventually crack problems that current computers can’t, such as discovering new pharmaceuticals to treat intractable disease.”
Tags: Banks, Companies, Computers, Early-stage, Health care, Industries, Internet, Obstacles, Overcome, Quantum, Research, Tinkering
American Banker (June 21)
“The Federal Deposit Insurance Corp. plans to hike deposit insurance assessment rates next year — a move that would increase costs for banks as they continue to see high deposit growth more than a year after the last round of pandemic stimulus.” On Tuesday, “the FDIC voted to issue a notice of proposed rulemaking that would raise deposit insurance assessment rates by 2 basis points for all insured depository institutions.”
Tags: Assessment rates, Banks, Costs, Deposit growth, Depository institutions, FDIC, Increase, Insurance, Pandemic, Rulemaking, Stimulus
Wall Street Journal (May 24)
A “candid presentation” last week on “Why investors need not worry about climate risk” created an uproar, for which Stuart Kirk has been suspended as HSBC’s global head of responsible investing. At the WSJ, “we understand why banking regulators and businesses that hope to make money off the coming tidal wave of climate regulation might be offended by his truth-telling. But he merely said what many in his industry believe but are too timid to say: Climate change poses a negligible risk to the global economy and bank balance sheets.”
Tags: Banking regulators, Banks, Businesses, Candid, Climate change, Climate regulation, Climate risk, Global economy, HSBC, Investors, Kirk, Money, Negligible risk, Offended, Presentation, Responsible investing, Suspended, Tidal wave, Timid, Truth-telling, Uproar
