The head of the International Monetary Fund (IMF), Kristalina Georgieva, urged this Sunday to “remain alert” to the “greater uncertainty” in the financial sector, comments that come after the recent turmoil with Western banks.
The bankruptcy of California’s state-owned Silicon Valley Bank (SVB) on March 10 raised concerns about the health of the banking sector in the United States and Europe.
The first European victim, Credit Suisse, was acquired by compatriot UBS on Sunday for a fraction of its market value.
“It is clear that risks to financial stability have increased,” Kristalina Georgieva said today at the China Development Forum, an event hosted in Beijing by the Chinese government.
The acquisition of Credit Suisse by UBS, coordinated by the Swiss authorities, as well as the central bank’s recent measures to improve access to liquidity, prevented panic but failed to bring stability to the markets.
“Policymakers have taken decisive action in response to risks to financial stability,” Georgieva said in her speech.
“These measures have eased market tensions to some degree, but uncertainty is high, underscoring the need for continued vigilance.”
Bank shares on European stock exchanges fell further on Friday.
The recent statements by Christine Lagarde, President of the European Central Bank (ECB), reaffirming the resilience of the banking system, and those by French President Emmanuel Macron and German Chancellor Olaf Scholz, who were intended to be reassuring, failed to calm things down. .
The president of the United States, Joe Biden, said this Friday in Ottawa (Canada) that the “banks were doing quite well” and that he did not see anything “about to explode.” He acknowledged, however, that it will take “a bit of time for things to calm down.”
Source: TSF
