Rising concerns about the banking industry are reaching world markets. International regulators are now trying to stabilize the financial markets following bank collapses in the U.S. and a big bank buy-out abroad.
The bank failures in the United States led to global panic. Now, regulators hope to avoid a repeat of 2008 when the financial bubble burst.
Members of Congress are also calling for investigations.
A buyer has emerged for one of the failed U.S. failed banks, New York-based Signature Bank. New York Community Bank is putting up almost $3 billion dollars to acquire the failed bank. Signature became the second bank to fail last week after Silicon Valley Bank (SVB) collapsed. SVB is still awaiting a buyer.
But reports say that the Federal Reserve knew SVB had red flags as far back as 2021 when it learned the bank might not have enough cash to handle a crisis.
Sen. Elizabeth Warren (D-Mass) is calling for an investigation into the regulatory process.
"What happened was exactly what we should have predicted. These big multi-billion dollar banks loaded up on banks, loaded up on risk. They boosted their short term profits. They gave themselves huge bonuses and big salaries. And they exploded their banks," Warren told ABC News over the weekend.
A new report from multiple financial scholars says nearly 200 US banks could be at risk of failing if customers initiated bank runs. The crisis in America created a domino effect on other banks around the world.
The largest bank in Switzerland, UBS, agreed to buy rival Credit Suisse for $3.2 billion dollars in a deal brokered by the Swiss government. Credit Suisse had operated for 166 years.
"The bankruptcy of a global systemically important bank would have caused irreparable economic turmoil in Switzerland and throughout the world," said Karin Keller-Sutter, a Swiss Federal Council member.
The House Financial Services Committee will hold its first hearing on the bank failures next week.
"Well, I think we know we had a very rough week for American banking, and we lost- lost confidence. And- and I think that is- that raises the questions of what happened last weekend," said U.S. Rep. Patrick McHenry (R-NC). McHenry chairs the House committee.
Bloomberg reports billionaire investor Warren Buffet has had multiple conversations with the Biden administration about the current crisis. There's a possibility Buffet could invest in regional banks. He helped Goldman Sachs and Bank of America when they were hit hard by financial trouble in the past.
***Please sign up for CBN Newsletters and download the CBN News app to ensure you keep receiving the latest news.*
Did you know?
God is everywhere—even in the news. That’s why we view every news story through the lens of faith. We are committed to delivering quality independent Christian journalism you can trust. But it takes a lot of hard work, time, and money to do what we do. Help us continue to be a voice for truth in the media by supporting CBN News for as little as $1.
Support CBN News
