(new: courses updated, more comments and courses, SVB share suspended)
FRANKFURT (dpa-AFX) – Problems at the US Silicon Valley Bank (SVB) also left their mark in Europe on Friday. The weakest sector was that of bank shares with a minus of almost four percent. Some experts warn against transferring the US start-up financier’s problems to the entire sector. Nevertheless, the prices of European bank stocks followed the weak signals from the USA. Memories of the financial crisis were awakened.
SVB had surprisingly announced the issue of shares the previous day after a large sale of assets such as government bonds and mortgage securities resulted in a loss. The value of such securities falls when interest rates rise. In addition, the company announced a billion-dollar loss for the first quarter. Investors are believed to have withdrawn massive amounts of funds fearing for the health of California’s Silicon Valley Bank, which is a subsidiary of SVB Financial.
Daniel Pfändler, portfolio strategist at Mainsky Asset Management, described the situation in the US banking sector as quite worrying. He spoke of a special individual case with the start-up financier SVB, so he currently classifies the probability of a systemic banking crisis as low. However, the turmoil showed that in the banking sector “a more difficult fundamental environment and a restrictive monetary policy environment are colliding”.
So it is hardly surprising that banks in Europe brought up the rear in an industry comparison. However, the RBC analyst Anke Reingen emphasized in a study that she considers the price losses in the sector to be exaggerated, because European banks are financially much better diversified and structured.
In Frankfurt, Deutsche Bank (Deutsche Bank) shares lost 7.4 percent and held the red lantern in the Dax (DAX 40). Commerzbank’s shares fell by 2.6 percent. On the European stage, sector stocks such as BNP Paribas, BBVA, Santander, ING (ING Group), UBS and Credit Suisse (Credit Suisse (CS)) lost between 3.4 and 4.8 percent.
The papers of the ailing SVB Financial (SVB Financial Group) fell by almost 70 percent in pre-market US trading after they had already lost more than 60 percent the previous day. Trading in the paper is currently suspended. According to the news channel CNBC, efforts to raise capital have failed, so that negotiations for a sale are being held.
“The Silicon Valley Bank still seems to be an isolated case,” emphasized fund manager Thomas Altmann from asset manager QC Partners. “But previous crises have shown how great the risk of contagion among banks is. This is why investors are reacting so sensitively to the news from California.”
Chief strategist Joachim Klement from the investment bank Liberum Capital spoke of growing fears of a credit crunch. However, he does not believe that the SVB situation poses an immediate threat to the European banking system. The US institute has a very special business model and specializes in venture capital and the financing of young growth companies. This is quite unique within the banking scene. Non-performing loans are likely to increase this year, but the reserves of banks in Europe and the US are sufficient to absorb any problems.
The news from SVB was coupled with other bad industry news the day before. The crisis in the market for digital currencies such as Bitcoin and Ether had previously brought a heavyweight in the crypto industry to its knees, the US financial group Silvergate Capital. The crypto bank announced the day before that it would cease operations and voluntarily initiate its own orderly processing./mf/ag/mis/tih/he
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