At least two major banks in the Europe are examining contagion scenarios that could spread across the region’s banking sector and hoping that the Federal Reserve and the ECB intervene with stronger signs of support, two senior executives with knowledge of the deliberations told Reuters.
The effects of the crisis of confidence on the Credit Suisse Group AG and the failure of two banks in the U.S may continue to ripple through the financial system next week, the two executives separately told Reuters on Sunday.
The two banks have been carrying out their own internal deliberations on how soon the European central bank should step in to highlight banks’ resilience, specifically their capital and liquidity positions, according to the sources.
Central to these internal discussions is whether such statements could backfire and create even more panic if made too soon, the sources said.
Executives said their banks and the sector are well capitalized and have strong liquidity, but fear the crisis of confidence could drag down more banks.
One of the executives said that the Federal Reserve may have to act first, as bank failures Silicon Valley Bank It’s from Signature Bank us U.S triggered concerns in Europe.
O ECB declined to comment. A spokesman for Fed did not immediately comment.
Source: Moneytimes
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