Tag

Contagion Risk

All articles tagged with #contagion risk

finance2 years ago•2 min saved

Chinese Shadow Bank's Massive Debt Revealed: £30bn Shortfall and $64 Billion in Liabilities

Zhongzhi, a major Chinese asset and wealth management company in the shadow banking sector, has admitted a shortfall of nearly £30bn and warned investors of its "severe insolvency." The company attributed the crisis to the departure of senior executives, which led to "internal management running wild." Zhongzhi's troubles highlight concerns about contagion in China's economy, particularly in the property market, which has faced a liquidity crisis due to strict debt limits. While some analysts expect government intervention to prevent the spread of Zhongzhi's troubles, others believe a bailout is unlikely as the trust industry represents a small portion of the financial system and most of Zhongzhi's creditors are wealthy individual investors.

via The Guardian|

#china #contagion-risk #finance

finance2 years ago•1 min saved

Deutsche Bank shares plummet amid default insurance cost spike.

Deutsche Bank shares fell by more than 9% after a sudden spike in credit default swaps on Thursday night, as concerns about the stability of European banks persisted. The emergency rescue of Credit Suisse by UBS has triggered contagion concern among investors, which was deepened by further monetary policy tightening from the U.S. Federal Reserve on Wednesday. Moody's suggested that, as central banks continue their efforts to reel in inflation, the longer that financial conditions remain tight, the greater the risk that "stresses spread beyond the banking sector, unleashing greater financial and economic damage."

via CNBC|

#contagion-risk #credit-default-swaps #deutsche-bank

finance2 years ago•1 min saved

Janet Yellen's Shifting Stance on Bank Stability and Deposit Insurance

Treasury Secretary Janet Yellen's mixed signals on providing a de facto guarantee on all U.S. bank deposits are becoming a threat to the financial system. On Tuesday, she said protecting uninsured depositors over $250,000 could "be warranted if smaller institutions suffer deposit runs that pose the risk of contagion." However, on Thursday, she walked back her comments from the day before, muddling the rules and the Administration's message, which requires clear, consistent rules for market confidence and financial stability.

via The Wall Street Journal|

#bank-deposits #contagion-risk #finance

banking2 years ago•2 min saved

The Troubling State of Banking and Finance in Today's World.

Former NYDFS superintendent Maria Vullo said that regulators did not shut down Signature Bank due to its crypto clients, but rather because of the bank's unreliable and inconsistent data, creating a crisis of confidence in its leadership. The bank may have also suffered from contagion risks following the closure of Silicon Valley Bank just days earlier. Regulators were able to quickly deal with both banks to send a strong message to the public that the system is safe and to prevent depositors from pulling out their money from other banks.

via CoinDesk|

#banking #contagion-risk #depositors

finance2 years ago•3 min saved

Charles Schwab Faces Investor Exodus as Stock Underperforms Market.

Charles Schwab Corp. experienced $8.8 billion in net outflows from its prime money market funds this week, with investors questioning the brokerage's resilience amid concerns about the health of the wider financial industry. The outflows were from two Schwab Value Advantage Money funds, representing the largest redemptions in at least six months. While outflows are a risk, the overall Schwab franchise remains healthy, according to a Bloomberg Intelligence report. Schwab's money market funds are stress-tested for their exposure to interest rate changes and have daily and weekly liquidity levels above regulatory requirements.

via Yahoo Finance|

#charles-schwab #contagion-risk #finance