The big European banks have suffered sharp falls in the stock market due to the unforeseeable consequences for the sector that the bankruptcy of the Americans can cause Silicon Valley Bank and Signature Bank.

The debacle of the Silicon Valley Bank (SVB), which has been intervened after its shares plummeted in two consecutive days due to its serious financial problems, has affected the entire sector outside and within the United States and has aroused fear of some investors to constitute the prologue of a new crisis similar to the one provoked by Lehman Brothers.

He September 15, 2008Lehman Brothers filed its formal declaration of bankruptcy after the exodus of most of its clients, drastic losses in the stock market and the devaluation of its assets by the main risk rating agencies.

These phenomena were produced mainly by the involvement of Lehman in the crisis of the subprime mortgagestaking excessive risks. Subsequently, allegations of negligence were filed, even leading to criminal charges. The Lehman Brothers bankruptcy is the largest bankruptcy in US history.

However, according to the opinion of the experts of the Spanish Institute of Analyststhe resolution of SVB and Signature Bank and the bankruptcy of Silvergate will not cause a crisis similar to the one that occurred after the bankruptcy of Lehman Brothers.

“The current uncertainty in the market is great, but it cannot be compared with the situation that was generated by the bankruptcy of Lehman Brothers in 2008. In addition, the banking model followed by European banks is different from that of North American ones and they are not so involved in the business of technology companies”, he explained from the Institute.

Alberto Iturralde, an expert in the stock market, explained to ETB that “US banking products are much more dangerous. So, probably, the same thing will not happen here.” According to the economist Massimo Cermelli“the Federal Reserve has intervened to prevent damage and avoid contagion. But, even so, fear has spread.”

The president of United States Joe Biden He has wanted to reassure society by ensuring that the United States banking system is safe. Biden has ensured that the clients of both banks will be able to dispose of their money.

The Commissioner for the Economy Paolo Gentilonihas assured that he does not see “specific risk of contagion” for European banks, although from Brussels they will closely follow the evolution of the case.

For her part, the Vice President of Economic Affairs, Nadia Calvinohas ensured that the banks of the Spanish State face the scenario of financial “turbulence” with “healthy” balance sheets and with a “reinforced” supervision and regulation framework.

Source: Eitb

Alia

Alia is a professional author and journalist, working at 247 news agency. She writes on various topics from economy news to general interest pieces, providing readers with relevant and informative content. With years of experience, she brings a unique perspective and in-depth analysis to her work.