The sudden collapse of Silicon Valley Bank, a subsidiary of SVB Financial (SIVB), triggered a banking crisis that spun out across financial sectors in the U.S. and overseas. On Thursday, Treasury Secretary Janet Yellen assured Congress that the banking system remains strong. Meanwhile, big banks discussed potential aid for beleaguered lender First Republic (FRC), which is exploring a potential sale.
San Francisco-based First Republic dived 28% Thursday and other regional banks, particularly those in the West, followed suit. Beverly Hills, Calif.-based Pacific West Bank (PACW) opened to an 18% loss. Zions Bancorp (ZION), based in Salt Lake City, fell 3.8% in the morning. Western Alliance (WAL) dropped more than 5.8%, nearly erasing the Phoenix, Ariz.-based bank’s 8.3% rebound Wednesday.
Larger banks pared losses after U.S. financial institutions took a beating Wednesday. JPMorgan Chase (JPM) inched up 0.4% early Thursday after falling 4.7% on Tuesday. Wells Fargo (WFC) edged 0.3% higher following its 3.2% dive Wednesday. Goldman Sachs (GS) traded down 0.4% and dipped 3% Wednesday.
Late Wednesday, the Swiss National Bank agreed to lend Credit Suisse (CS) $54 billion after shares cratered as much as 30% during the day. The meltdown rippled across European banks and other financials, with trading for several temporarily halted on European exchanges.
The turbulence among banks and other financial stocks has given the Federal Reserve more reasons not to hike interest rates during next week’s meeting.
As the banking crisis unfolds, stay on top of the latest news and ongoing coverage.
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