WSJ: Economists predicted fate of SVB 186 bankrupt US banks
Against the backdrop of the Silicon Valley Bank (SVB) bankruptcy, economists predicted a similar fate for 186 other US banks. On this subject informed Wall Street Journal (WSJ).
In a study published by the Social Science Research Network, experts calculated the losses of banks during the campaign US Federal Reserve (Fed, local central bank) to raise the discount rate. They also looked at the share of bank funding coming from uninsured depositors.
“According to their estimates, in 186 banks UNITED STATES in the case of withdrawals by uninsured depositors, the insured depositors may face impairment as the bank will not have enough assets,” the publication notes.
The WSJ authors believe that in this case, the regulatory authorities should intervene in the situation.
About the Silicon Valley Bank Failure became known March 11. The SVB became the biggest bank failure since the 2008 crisis. In 2022, it was valued at $40 billion and its capitalization grew rapidly.