Financing official: expect more banks to close

Robert Besser
25 Mar 2023, 13:10 GMT+10

Luke Ellis, CEO of hedge fund Man Group, said that the banking crisis sparked by the collapse of Silicon Valley Bank has not ended, and more banks will fail within two years
In a move that has brought some calm to markets after the ongoing chaos, Credit Suisse was rescued by Swiss rival UBS over the weekend.
The growth in social media had accelerated how quickly concerns about banks circulate

LONDON, England: During a Bloomberg conference held in London this week, Luke Ellis, CEO of hedge fund Man Group, said that the banking crisis sparked by the collapse of Silicon Valley Bank has not ended, and more banks will fail within two years.

In a move that has brought some calm to markets after the ongoing chaos, Credit Suisse was rescued by Swiss rival UBS over the weekend.

"I think we will have significantly more banks that do not exist in 12-24 months," Ellis said, as quoted by Reuters, adding that he thought smaller and regional banks in the US and challenger banks in the UK could be at risk.

The growth in social media had accelerated how quickly concerns about banks circulate, he said, noting, "Things happen at a much faster speed, whether it is a crisis or it is good news."

However, a spokesperson for the UK central bank, the Bank of England, said, "The UK banking system is well capitalized and funded, and remains safe and sound," as reported by Reuters.

In response to the crisis, central banks around the world have coordinated measures to ensure the flow of cash between banks globally.

Alexander Chartres, investment director at asset manager Ruffer LLP, stressed that if there is to be a US recession, he would invest across different asset classes.