Is the worst over for the bank sector? Digital bank runs and the future of banking. After SVBs collapse, regulators grapple with First Republic and a crisis in Europe.
More than a week after SILICON VALLEY BANK’s sudden collapse, and the failures at SIGNATURE and SILVERGATE banks, the CONVERSATION picks up where we left off on our last Special Episode. Veteran bank analyst DICK BOVE, chief financial strategist at ODEON CAPITAL GROUP, offers his accounting of today’s state of the banking industry.
Is the sector still in trouble, a state of rot? Are other banks still vulnerable? BOVE takes a close look at the financial and capital strength of the industry across multiple lines, to offer his informed and comprehensive opinion.
“The risk managers were deficient at all of these banks when they didn’t hedge [their risk] against 30-year Treasuries,” says BOVE, responding to MAT VAN ALSTYNE, ODEON co-founder and managing partner, adding that the same “deficiency” is evident across multiple financial institutions, including the US Fed in an era of rising interest rates.
The CONVERSATION also looks at UBS’s agreement in recent days to acquire troubled crosstown rival Credit Suisse, with our eyes on its AT1 bonds which regulators wrote down to zero. Finally, host JOHN AIDAN BYRNE raises questions about the dynamics of bank runs in an age of digital commerce.
Joining the CONVERSATION, our host JOHN AIDAN BYRNE reprises some of the key developments.
Questions & Comments: Podcast@OdeonCap.com