First Republic Bank: Wall St pledges billions to rescue California lender as Credit Suisse climbs liquidity line – latest

Elizabeth Warren says the 2018 law helped lead to Silicon Valley’s bank collapse

Major US banks have agreed to invest $30 billion in San Francisco-based First Republic Bank as a sign of confidence in the banking system.

A consortium of Bank of America, Wells Fargo, Citigroup and JP Morgan will deposit about $20 billion, while Goldman Sachs and Morgan Stanley will deposit another $5 billion, Truist, PNC, US Bancorp, State Street and Bank of New York Mellon. each depositing about $1 billion.

Treasury Secretary Janet Yellen told the Senate Finance Committee on Thursday morning that the US banking system remains stable and Americans can feel confident that their deposits will be there when they need them.

Speaking at a budget hearing, Yellen highlighted her determination to protect depositors by taking “decisive and strong” actions by the US government this week to restore public confidence in the banking system following the collapse of a Silicon Valley bank.

Meanwhile, troubled Swiss bank Credit Suisse saw its shares rise more than 30% as trading in Zurich opened on Thursday after appealing to the central bank to allay fears about its finances. The lender will borrow up to 50 billion Swiss francs (£44 billion, $54 billion) from the Swiss National Bank to shore up its liquidity.

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Premium: It’s not quite a repeat of 2008, but the cracks in the global banking system have been revealed.

This week there was a banking bubble, rinse, repeat, with the collapse of a Silicon Valley bank followed by a much bigger crisis in the form of Credit Suisse.

The medium-sized SVB was more systemically important than many thought, raising big questions about US oversight.

But the dangers of Credit Suisse, a pillar of the Swiss banking establishment and a (trembling) member of the top table, have never been in doubt.

Oliver O’ConnellMarch 17, 2023 05:20

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Premium: UK tech firms benefit from SVB bailout – but important lessons to be learned

Let’s start with the good that came out of the collapse of the Silicon Valley bank that controls a quarter of the companies in the UK’s tech sector and threatens to collapse.

Britain’s hand was saved at the weekend by a joint deal between the Bank of England, the government and HSBC – a bank that picked up the pieces after a “competitive process” and (so we’re told) spared the taxpayer. nasty wallop in the process.

There’s an old-school comfort in being a broker behind closed doors. As a result, the business will be transferred to the UK bank HSBC, which means that depositors will receive their money and technical staff will receive their salaries.

Oliver O’ConnellMarch 17, 2023 01:20

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ICYMI: DOJ and SEC to investigate Silicon Valley bank collapse

The Santa Clara, Calif.-based tech and startup-focused lender was seized by regulators Friday in a run on deposits, making it the second-largest bank failure in U.S. history.

Oliver O’ConnellMarch 16, 2023 23:20

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Why do banks need new help?

Markets were stabilizing on Thursday night on hopes that the new lifelines would limit any “contagion” to other banks.

Thomas Kingsley and Alastair Jamieson see what’s going on.

Oliver O’ConnellMarch 16, 2023 10:20 p.m

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Major US banks benefit from rising deposits

The collapse of Silicon Valley Bank and Signature Bank sent some customers rushing to pull their money out of smaller banks, leading to a sharp drop in new deposits for larger institutions.

Oliver O’ConnellMarch 16, 2023 9:50 p.m

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Meanwhile, this is how the trading day went in London

London’s top stocks faced a roller-coaster session on Thursday as traders sent the FTSE 100 up and down throughout the day, but it managed to close higher despite turbulent trading.

Trading on Thursday was highly volatile, with the index coming off its worst day in three years on Wednesday amid concerns over the future of banking giant Credit Suisse.

The top-tier index initially gained strength as trade opened after Swiss authorities provided a £45 billion emergency loan to a stressed bank.

But throughout the day it bounced like a yo-yo, at one point even slipping into negative territory. By the end of the day, it increased by 0.9%.

Oliver O’ConnellMarch 16, 2023 21:20

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Premium: The global banking system has been disrupted, but it’s not yet a repeat of 2008.

This week there was a banking bubble, rinse, repeat, with the collapse of a Silicon Valley bank followed by a much bigger crisis in the form of Credit Suisse.

The medium-sized SVB was more systemically important than many thought, raising big questions about US oversight.

But the dangers of Credit Suisse, a pillar of the Swiss banking establishment and a (trembling) member of the top table, have never been in doubt.

Oliver O’ConnellMarch 16, 2023 8:45 p.m

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Elizabeth Warren: GOP Gives Fed Chair ‘Firefighter Focused on Banking Regulations’

The Massachusetts Democrat and longtime critic of the financial industry made the announcement during a Senate Finance Committee hearing with Treasury Secretary Janet Yellen.

Eric Garcia has a full story.

Oliver O’ConnellMarch 16, 2023 8:30 p.m

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Dow closes 370 points as Wall St banks step in to bail out First Republic

Wall Street’s major indexes rose sharply on Thursday after the news and confirmation that some of the largest U.S. financial institutions would come to the rescue of First Republic Bank.

Banks agreed to invest $30 billion in First Republic Bank to show confidence in the US banking system.

Bank of America, Wells Fargo, Citigroup and JPMorgan Chase will each contribute about $5 billion, while Goldman Sachs and Morgan Stanley will deposit about $2.5 billion, the banks said in a press release.

Truist, PNC, US Bancorp, State Street and Bank of New York Mellon each deposit about $1 billion.

The Dow Jones Industrial Average rose 371.98 points, or 1.17%, to 32,246.55. The S&P 500 added 1.76% to close at 3,960.34. The Nasdaq Composite rose 2.48% to 11,717.28.

Oliver O’ConnellMarch 16, 2023 20:19

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11 banks deposit 30 billion dollars in the First Republic

On Thursday afternoon, a group of financial institutions agreed to invest $30 billion in First Republic in a show of confidence in the US banking system.

Bank of America, Wells Fargo, Citigroup and JPMorgan Chase will each contribute about $5 billion, while Goldman Sachs and Morgan Stanley will deposit about $2.5 billion, the banks said in a press release.

Truist, PNC, US Bancorp, State Street and Bank of New York Mellon each deposit about $1 billion.

Oliver O’ConnellMarch 16, 2023 at 7:56 p.m

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