The day after the storm, Piazza Affari opens flat with the Ftse Mib at + 0.07%, at 26,200 points. Yesterday Milan had closed down sharply: the worst price list of the day in Europe, in the wake of the collapse of Svb. The Ftse Mib had lost 4.03% to 26,183.54 points. The banks are still in trouble. Yesterday US President Joe Biden reassured investors and savers, stressing that “American banks are solid” and does not see a contagion. The number one of the Federal Reserve, Jerome Powell, calls for a “complete, transparent and rapid review” of the causes that led to this crisis. Yet First Republic, PacWest and the Western Alliance are also shaking, with monstrous losses exceeding 50%. In Europe, the implications are being watched carefully, although the White House and the Treasury are ruling them out as they are still trying to sell SVB to a buyer. In sight, according to analysts, there is a halt to rate hikes by the Federal Reserve and an impact on the startups financed by SVB so far.
Interest rate risk in Europe: pressure is mounting for the ECB to curb increases. The weakening of the bonds caused the institution to collapse
ALESSANDRO BARBERA
Biden’s goal is to go further, securing the domestic system. This is why President Biden says he is “confident” and willing to ask Congress and the regulatory authorities to “strengthen the rules for banks” after the bankruptcy of Svb and Signature. “We have to prevent this from happening again,” he explained, hinting that there will soon be a crackdown on the Dodd-Frank Act, crucial for the supervision of medium-small banks. That is Category 4 according to the current legislation, under 250 billion dollars of assets. Eased in 2018, Dodd-Frank will be tightened.