Thomas Lyons 
US Regional Banks Slump as Investors Remain Cautious Amid Industry Turmoil
US regional banks were hit with a renewed sell-off as PacWest and Western Alliance each slumped more than 25%, leading to turmoil in US bank shares. Trading in shares of both banks were halted for volatility, amid the broader slide. Comerica and Zions Bancorp each fell more than 10%, while Charles Schwab sank more than 5%. The sector’s retreat comes a day after First Republic Bank’s seizure and sale to JP Morgan Chase, and underscores investors’ ongoing concerns about competitors of the four banks that have collapsed since early March.
JP Morgan Chase CEO Jamie Dimon was quick to proclaim the current leg of the banking crisis “over” during a conference call discussing his bank’s acquisition of First Republic earlier this week. He recommended everyone “just take a deep breath” even as higher interest rates and stress on the commercial property pose a threat to the banking sector. However, investors remain cautious amid the industry turmoil.
Western Alliance and PacWest are among a number of regional banks investors zeroed in after Silvergate, Silicon Valley Bank, and Signature Bank collapsed in quick succession in recent weeks and demonstrated the threat posed to commercial lenders. The ongoing concerns of investors have led to a sell-off in US bank shares.
In Europe, UBS stepped in to buy troubled Credit Suisse. “Wall Street is wondering which bank could be the next one that needs a rescue and that is making it easy to pick on the other regional banks,” said Ed Moya, Oanda senior market analyst.
The banking sector is facing a challenging time with higher interest rates and stress on the commercial property posing a threat. The collapse of four banks since early March has also contributed to the ongoing concerns of investors. While JP Morgan Chase CEO Jamie Dimon has proclaimed the current leg of the banking crisis “over,” investors remain cautious amid the industry turmoil.
PacWest and Western Alliance each slumped more than 25%, leading to turmoil in US bank shares. Trading in shares of both banks were halted for volatility, amid the broader slide. Comerica and Zions Bancorp each fell more than 10%, while Charles Schwab sank more than 5%. The sector’s retreat comes a day after First Republic Bank’s seizure and sale to JP Morgan Chase, and underscores investors’ ongoing concerns about competitors of the four banks that have collapsed since early March.
The ongoing concerns of investors have led to a sell-off in US bank shares. Western Alliance and PacWest are among a number of regional banks investors zeroed in after Silvergate, Silicon Valley Bank, and Signature Bank collapsed in quick succession in recent weeks and demonstrated the threat posed to commercial lenders. “Wall Street is wondering which bank could be the next one that needs a rescue and that is making it easy to pick on the other regional banks,” said Ed Moya, Oanda senior market analyst.
In Europe, UBS stepped in to buy troubled Credit Suisse. The banking sector is facing a challenging time with higher interest rates and stress on the commercial property posing a threat. While JP Morgan Chase CEO Jamie Dimon has proclaimed the current leg of the banking crisis “over,” investors remain cautious amid the industry turmoil.
