The bankruptcy of California’s Silicon Valley Bank (SVB) on March 10 raised concerns about the soundness of the banking sector in the United States and Europe.
First European victim, Crédit Suisse was taken over in disaster by its compatriot UBS last Sunday for a fraction of its stock market value.
It is clear that the risks to financial stability have increased
Kristalina Georgieva said on Sunday at the China Development Forum, a meeting organized in Beijing by the Chinese government.
Avoid the contagion effect
The takeover of Crédit Suisse by UBS, piloted by the Swiss authorities, as well as the recent measures taken by central banks to improve access to liquidity have made it possible to avoid panic, but without succeeding in restoring stability to the markets.
Policymakers took decisive action in response to risks to financial stability
underlined Mr. Georgieva in his speech.
« These measures have, to some extent, eased tensions in the markets, but uncertainty is high, underscoring the need to remain vigilant. »
In fact, banking stocks on European stock markets fell again on Friday.
Strong voices that want to reassure
Recent statements by Christine Lagarde, President of the European Central Bank (ECB), who reaffirmed the resilience of the banking system, and those by French President Emmanuel Macron or German Chancellor Olaf Scholz, who were intended to be reassuring, did not knew how to calm the spirits.
US President Joe Biden said Friday in Ottawa that the banks were doing quite well
and he saw nothing about to explode
. However, he acknowledged that it will take some time for things to calm down
.