[ANALYSIS] Silicon Valley Bank "SVB" (SIVB): Contagion fears spark a global banking sell-off

Analysis details (08:35)


The US banking sector fell into panic mode following a string of concerning developments this week, with the latest - the Silicon Valley Bank saga – sparking a global sectoral selloff.

To round up the main headlines for the sector this week:

Desks suggest that some of the contagion panic seen across larger “systemically important” US banks yesterday was overdone - with Silvergate’s and SVB’s woes more idiosyncratic and larger exposures in different sectors (crypto, tech startups) versus banks such as Bank of America (BAC), Citi (C) and JPMorgan (JPM). Analysts also suggested that since the 2008 financial crisis, regulators have forced the largest lenders to hold more capital, thus resulting in a more insulated balance sheet to the risks facing the smaller banks.

However, others remind us that problems in the banking industry persist (whilst contagion risks from the Silvergate/SVB events remain low). Analysts suggest banks’ Net Interest Income/Margin (NII/NIM) look to have peaked in aggregate while credit is weakening at a modest pace.




10 Mar 2023 - 08:40- Research Sheet- Source: Newsquawk

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